Salary review / promotion letter
Confirms a salary change, promotion, bonus, or compensation adjustment with an effective date and clear statement of what is — and isn't — changing.
Re: Compensation update
Dear ,
On behalf of , I'm pleased to confirm an update to your compensation, effective .
Your title is updated from to .
Your annual salary is updated from to , less applicable statutory deductions.
Additionally:
Why
All other terms of your employment — reporting line, location, benefits eligibility, vacation, and your obligations of confidentiality, IP assignment, and non-solicitation — remain unchanged. This letter does not replace your employment agreement; it amends only the compensation and title elements identified above.
Thank you for your contributions. We're glad you're here.
Sincerely,
Made with WalnutsHR Paper · Reviewed for Ontario · April 2026
No compliance hints for this jurisdiction yet — your document looks good for the basics. Have a lawyer review before sending anything consequential.
About this template
A salary review letter is a small document with outsized impact: it's the formal record of a compensation change, and it can become evidence in a dispute years later. Two things matter most — be specific about what's changing, and be explicit about what isn't.
When to use it
- Annual or off-cycle salary adjustment.
- Promotion or scope change with a compensation impact.
- One-time bonus or signing payment that needs documenting outside the pay-stub trail.
What to include
- Old and new salary, with effective date.
- Old and new title (when changing).
- Any bonus or one-time amount.
- A short "why" — surprisingly often the most-read line.
- Explicit confirmation that everything else stays the same.
Frequently asked questions
Do I need the employee's signature?
Most companies don't require a counter-signature for an increase. For decreases or significant scope changes, get the employee's signed acknowledgement to avoid a constructive-dismissal argument later.
What if the employee is on probation?
Compensation changes during probation are routine. The letter doesn't extend or reset the probationary period unless you say so explicitly — which you usually shouldn't.
Legal disclaimer. Salary changes can interact with overtime classification, benefits eligibility, and (in some US states) wage-history laws. For material changes — especially demotions or pay cuts — get an employment lawyer to review the letter; unilateral material changes can constitute constructive dismissal in Canada.
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