If you consider some of the major transactions in your life like buying a car or a house, you would usually sit down and sort out with the other person all of the details of the transaction so that the agreement is recorded in writing and many of the uncertainties in the transaction are removed because it is in writing.
Your job is the source of income that gives you the ability to support your family and to live in the property that you inhabit. It pays for your car and all of your consumer spending. Surprisingly, very few people insist on using a written contract when they get a job. In fact, if you look at the statistics it seems that only the most senior members of the workforce ever have employment contracts which are conscientiously crafted.
So often, a job changes meaning that there is less clarity on the job description, less certainty over what duties are to be performed by the employee and what the employee to to be paid. If there is no written contract, other people in the work place will not necessarily respect others right to what was originally agreed at the beginning of the negotiation of the terms of employment.
Sometimes the word of the other person is not enough
There are a number of problems with going on the basis of a verbal job offer, but these types of arrangements are not usually good if you are the worker because there is greater potential for the employer to later say that their memory of the events in the workplace was different to the employees and this means that if it is up to an objective third party to determine, they will probably err on the side of the person that they decide to trust which is not usually a firm basis on which to secure the rights of a worker.
Also, unless there is a written agreement, there is no guarantee that the person that originally hired the worker will remain in the organisation. If they change their status in the organisation or they get fired, there is no ability to clarify the original relationship between the company and the worker.
The problem with a letter of offer
It is a common practice for an employer to provide someone that has just got a job in the organisation with a letter of offer that summarises a lot of the basic elements of the employment relationship. The problem is that the wording of these letters is usually quite vague and contains a lot of qualifications and disclaimers which could undermine the viability of the documents as a legally concluded employment relationship. Because the company can often change its policies, there is not any ability to say that the contract has the necessary certainty to create a legal relationship.