November 18, 2016

Although there is no law that requires a company to have a personnel or employee handbook, it can be a wonderful tool to communicate your workplace culture, expectations and policies. You may think your business is too small or too informal, but you’ll see that having your policies in writing is a win-win for everyone.

Even though employees won’t always follow the rules, they do like to know them. Employees, both good and bad, like to know what conduct is expected by the company and what punishment they might expect if they fail to follow the rules.   Written correctly, the handbook allows a company to address a wide variety of rule violations without limiting the company’s ability to respond on a case-by-case basis as necessary.  If your handbook isn’t used or updated consistently, your business may not be running as efficiently as possible and may be at a high risk for costly employee relations issues.

You want your employees to behave in a certain way
Your company handbook should tell employees what your company expects not only to avoid disciplinary action, but also to tell them how they can succeed.  For example, the employee handbook should tell an employee how to:  request time off, inform the appropriate manager about possible harassment or discrimination, keep a time record, report possible theft, dress in an appropriate manner, etc.,  ensuring that the foundation is set for the employee to continue to effectively accomplish their job duties.

You want your employees treated in a consistent manner
Ideally, various managers will respond to similar rule and performance violations in a similar manner. A well-written handbook tailored to the manner in which your company does business helps to ensure this desired consistency. While a handbook cannot be an “instruction book” on every conceivable problem or issue, it should provide a framework for managers to follow in dealing with various circumstances.

Remember, the primary purpose of a handbook is to provide instructions to employees, not serve as a “manager’s guide.”  To the extent that your company uses a manager’s guide or believes that such a guide is a good idea, that guide should be a separate document from the employee handbook.

Describe the benefits you offer
Companies spend a great deal of money on each and every employee in ways that the employee often does not see or appreciate.  An employee handbook is an excellent way for a company to take credit for all that it does for the employee.

Without a great deal of detail in any policy, an employee handbook should list all the benefits provided by the company at no cost to the employee (for example, workers’ compensation), subsidized by the company (for example, many types of health insurance benefits), or available for purchase at reduced rates due to the company’s group membership  (for example, credit unions).  Additionally, a handbook should include the various types of paid and unpaid time off given to employees even if such leave is mandated by the government.

You want to win unemployment claims
In most states, winning an unemployment claim for a terminated employee requires proof that the terminated employee was on notice of a certain rule (or rules) and had been warned that violating the rule would lead to disciplinary action up to and including immediate termination.

A well-written employee handbook is the beginning of a successful defense. The page of the handbook containing the applicable policy, as well as the signed acknowledgement page, should be the first step of any unemployment paperwork submission for a rule violation or poor performance termination.

You want to win lawsuits
Many employment-based lawsuits hinge on consistent treatment of employees and/or ensuring that employees were on notice of important company policies and procedures.  A well-written employee handbook that reflects a company’s actual practices serves both of these purposes.

The employee handbook and the employee’s signed acknowledgement form are nearly always exhibits in a lawsuit and can help a company win. Imagine a jury looking at your current employee handbook. What does it say about your company?  Is it out of date?  Does it contain unlawful provisions?  Does it look “homemade” or cobbled together from multiple sources and documents?  Does it contain inconsistencies?  Could it be a better reflection of your company?

Important considerations for any employee handbook
Your handbook needs to reflect compliance with applicable federal, state and local law. This does not mean that every law needs to be specifically addressed and reiterated in detail in the handbook. Rather, the handbook should not conflict with any applicable law and should contain a clear statement that the company intends to comply with all applicable laws.

Your handbook should be tailored to your company and should clearly reflect how your company does business. Copying another company’s handbook or just adopting a handbook you find online, even from a very reputable source, may do more harm than good.

Your handbook is a reflection of the company. Handbooks that contain typos, are copied askew, are out-of-date, contain another company’s name, contain policies that don’t apply to your company in whole or in part and/or look sloppy or unprofessional, send a message that the company doesn’t really care about its employees.  For a small investment, any company can publish a well-edited, well-written, legally sound, professional looking employee handbook.

In the end, even the very best handbook fails to provide a benefit to the company if employees did not have easy access to it, and if the company cannot “prove” the employee received the handbook and understood that he or she was required to abide by it. To have such proof, a company needs a signed acknowledgement form.

By creating a custom handbook for your company that complies with the points listed above, both the company and the employee benefit.