Internal promotion offer letter template: new title, pay, manager, exempt status and trial period
On this page
- What should an internal promotion letter include?
- The internal promotion offer letter template
- Paragraphs for common variants
- What changes when a promotion makes someone exempt?
- Which pay transparency rules apply to internal promotions?
- Delivering it: conversation first, letter second
- A filled example
- Common mistakes
- Questions people ask
An internal promotion offer letter confirms in writing what changes when an employee moves into a new role: the effective date, new title, new pay and how it is paid, new manager and location, any change from non-exempt (overtime eligible) to exempt status, any trial period, and what stays the same. The exempt-status line needs care: as of October 2026 the federal standard salary level is $684 a week, or $35,568 a year (US Department of Labor), California's 2026 minimum for exempt employees is $70,304 a year (California DIR), and the duties test still has to be met. Some pay transparency laws, including New York's and Colorado's, also cover promotions.
Below: what the letter must cover, a copy-ready template, paragraphs for common variants, the exempt-status and pay transparency points, and a filled example. External offers use our offer letter template; the short internal offer email is template 6 in our job offer email templates; running the internal process fairly is in interviewing internal candidates.
What should an internal promotion letter include?
- New title and effective date, plus the date pay changes if different.
- New pay: amount, pay basis (hourly or salary), pay frequency, and any change to bonus or commission plans.
- Overtime status: whether the role is exempt or non-exempt, and what changes.
- New manager, team and work location.
- Trial or acting period, if any, and what happens at the end of it.
- What stays the same: benefits, continuous service date, existing agreements.
- Handover: the transition date agreed with the current manager.
- Signature and return date.
The internal promotion offer letter template
[Company letterhead]
[Date]
PRIVATE AND CONFIDENTIAL
[Employee full name]
[Current title], [Department]
Dear [First name],
Congratulations. I am pleased to confirm your promotion to [New title]
in [Department/team], effective [effective date].
1. YOUR NEW ROLE
Title: [New title]
Reporting to: [Manager name, title]
Location: [office / hybrid: (days) / remote from (state)]
Main responsibilities: [3–5 lines, or "as described in the attached
job description dated (date)"]
2. PAY
Your base pay will change from [current amount and basis] to
[new amount] [per year / per hour], paid [frequency], starting with
the pay period that includes [date].
[Bonus/commission: you will move from (plan) to (plan), as described
in (document). Your current plan applies to (period).]
3. OVERTIME STATUS
[Your new role is classified as exempt from overtime. From
(effective date) you will be paid a salary and will no longer be
eligible for overtime pay. Overtime you work before that date will be
paid in full in the normal pay cycle.]
[OR: Your new role remains non-exempt and eligible for overtime pay.]
4. TRANSITION
You will hand over your current work to [name] by [date], as agreed
with [current manager]. [Interim arrangements, if any.]
5. [TRIAL PERIOD, if used]
Your first [90] days in the role are a trial period. We will review
progress with you at [30/60/90] days against the goals in [document].
If either of us concludes the role is not the right fit by [date], you
may return to a role at your previous level and pay, [subject to
availability / in your previous team].
6. WHAT STAYS THE SAME
Your benefits, continuous service date of [date], and other terms of
employment stay the same unless set out in this letter. [Your
employment remains at will.]
Please sign and return a copy by [date]. If you have questions, speak
to [HR contact] or me.
Congratulations again,
[Name], [Title]
Accepted: ______________________ Date: __________
[Employee name]Paragraphs for common variants
Lateral transfer with no pay change
This letter confirms your transfer to [New title] in [team], effective
[date]. Your base pay, pay basis and overtime status do not change.
Your new manager is [name].Acting or interim appointment
From [date] you will act as [Title] while [reason]. During this period
you will receive [an acting allowance of (amount) per (period) / base
pay of (amount)]. The appointment ends on [date] or when a permanent
appointment is made, whichever is earlier, and you will then return to
[your current role and pay] unless offered the role permanently in
writing.Promotion with relocation
Your new role is based in [location] from [date]. [Company] will
support your move under the relocation policy dated [date], up to
[amount]. [Repayment terms, if any, as set out in (document).] If the
new location is in a different state, your pay, tax withholding and
leave entitlements will follow the rules of that state from [date].Pay effective before the letter is signed
Your new pay applies from [date]. Because this is earlier than the
date of this letter, the difference for [period] will be paid as a
one-time adjustment in the pay cycle ending [date].What changes when a promotion makes someone exempt?
A promotion into a first management or professional role often moves the person from hourly pay with overtime to a salary without it. That change is only lawful if the new role meets both tests:
- Salary level. The federal standard level is "$684 per week (equivalent to a $35,568 annual salary)" (DOL). Several states set higher floors; California's is $70,304 a year for 2026, calculated as twice the state minimum wage for full-time work (California DIR), rising to $72,384 on January 1, 2027 (California DIR). For a promotion effective in the new year, check the figure that applies on the effective date.
- Duties. The title does not decide the classification; the actual duties do. A "team lead" who spends most of the week doing the same work as the team may still be non-exempt.
- The changeover. Pay all overtime worked up to the effective date, and switch timekeeping on the same date. Our exempt vs non-exempt guide covers the tests.
As of October 2026. This is general information, not legal advice.
Which pay transparency rules apply to internal promotions?
| Jurisdiction | What applies to internal moves | Source |
|---|---|---|
| New York State | Employers with four or more employees list compensation ranges for advertised job opportunities, promotions and transfers | NY DOL, Labor Law 194-b |
| Colorado | Covered job opportunities are disclosed to employees, and within 30 days of the hire the employees the person will work with regularly get a post-selection notice: name, former title, new title and how to express interest in similar roles | CDLE INFO #9A, C.R.S. 8-5-201 |
| California | On request, the employer must give an employee the pay scale for the position they currently hold | DIR Equal Pay Act FAQ, Lab. Code 432.3(c)(2) |
Colorado's INFO #9A also distinguishes "career progression" moves based wholly on objective criteria such as time in role, which do not need a job opportunity notice but need their own career progression notice. Other states and cities have their own rules; see pay transparency laws by state and the internal job posting template. As of October 2026; not legal advice.
Delivering it: conversation first, letter second
Tell the person in a conversation, then send the letter the same day so the details are in writing while they are fresh. Agree with them when the team will be told; the announcement itself is version 5 in our new employee announcement email templates. Tell the other internal applicants before the announcement, in person; see how to tell an internal candidate they did not get the job.
Subject: Your promotion to [New title]: letter attached
Hi [First name],
As we discussed, congratulations on your promotion to [New title].
Your letter is attached with the details: effective date, pay,
[overtime status], and the handover with [current manager].
Please read it, ask me or [HR contact] anything, and sign and return it
by [date]. We'll share the news with the team on [date].
[Manager name]A filled example
Example (invented), California employer. A support specialist paid $31 an hour, non-exempt, is promoted to Support Team Manager effective January 4, 2027, at a salary of $84,000, managing five people and spending most of her time on hiring, scheduling and performance.
- The salary is above the California exempt minimum that applies on the effective date ($72,384 from January 1, 2027, not the 2026 figure of $70,304), and the duties are managerial, so HR classifies the role exempt.
- The letter states the overtime change, and that overtime worked through January 3 is paid in the normal cycle.
- A 90-day trial period with a right to return to a specialist role at her previous pay is included, because she asked for it.
Common mistakes
| Mistake | What happens | Fix |
|---|---|---|
| Promotion confirmed only in a chat message | No record of the effective date or pay | A signed letter for every promotion |
| Exempt by title | Overtime claims for a role that never met the tests | Check salary level and duties before the letter |
| Trial period with no return path | The employee risks their old job for a role that may not work | State what happens at the end of the trial |
| Bonus plan change left out | Disputes over which plan applies to the current quarter | Name both plans and the switch date |
| Team hears before the other applicants | Internal candidates learn by announcement | Applicants first, then the team |
Questions people ask
Do you need an offer letter for an internal promotion?
No law in most US states requires one, but a written letter is the only reliable record of what changed: the effective date, new title, new pay, new manager and any change to overtime status. Without it, disputes about when a raise started or whether a trial period applied come down to memory.
What should an internal promotion letter include?
The new title, the effective date, the new pay and how it is paid, the new manager and location, any change from non-exempt to exempt status, any trial or acting period and what happens if it does not work out, what stays the same (such as benefits and service date), and a date to sign and return it.
What happens to overtime when a promotion makes an employee exempt?
Overtime eligibility ends from the effective date only if the new role meets both the duties test and the salary level. Federally the standard salary level is $684 a week, and California requires at least $70,304 a year in 2026; other states differ. Overtime worked before the effective date is still owed. This is general information as of October 2026, not legal advice.
Do pay transparency laws apply to internal promotions?
Some do. New York requires compensation ranges in advertisements for promotion and transfer opportunities, Colorado requires notice of job opportunities to employees and a post-selection notice after the role is filled, and California employers must give an employee the pay scale for their current position on request. Rules vary by state and city; this is general information as of October 2026, not legal advice.