EMPLOYEE HANDBOOKS – ARE THEY REALLY NECESSARY?
Even though it is not a state or federal law requirement, many employers have an employee handbook, or at least a few written company policies. But just exactly where do those policies come from? That’s easy — the HR Department. But where does HR get the policies that govern the company? The answer to that question is not quite so simple. Employee policies can come from a multitude of sources such as style guides or boilerplate templates purchased online, but many times a policy is no more than “that is how we do things at this company.” While in many cases the company means no harm by not having a formal employee handbook, the lack of a formal set of documented employee policies can potentially lead to costly litigation.
Purpose of Employee Handbooks
Employee handbooks can be a useful business tool when developed correctly. They can:
- describe employer expectations of employees
- spell out work rules
- be used as a management tool for supervisors
- provide the company with an “affirmative defense” should the need arise
Handbooks can also provide a venue for employers to inform their workers of company values, describe benefit plans, and provide day-to-day guidance such as employee dress codes.
Employee Handbook “Must Haves”
Regardless of company size, there are several policies that should be developed and included in a handbook, or at a minimum provided to all employees. These include:
- “At-Will” Disclaimer – a statement explaining to employees that employment is not guaranteed, and that the employer can terminate employment with or without cause at any time is vital. Most states have requirements about where and how this statement must be included in a handbook to keep the handbook from being interpreted as an employment contract.
- Equal Employment Opportunity Statement – a statement should be crafted that outlines the company’s commitment to prohibit all forms of discrimination against ALL categories protected by law and reiterates that the company will not discriminate in any employment based decisions (i.e., hiring, training, promotions, etc.)
- Anti-Harassment Policy – harassment policies are not just for sexual harassment anymore and should include all types of behavior that could potentially cause a non-productive work environment. Also, an anti-harassment policy should clearly spell out multiple avenues which employees can use to report inappropriate behavior.
- Family and Medical Leave Act (if applicable) – for those employers covered by this Act (over 50 employees) there is a federal requirement that the company’s FMLA policies be provided to employees in writing, so what better place to put it than in the employee handbook?
- Fringe Benefits – a summary of benefits should be included to outline the basics of each benefit provided and to describe eligibility requirements.
- Computer and Phone Privacy – a handbook should include a policy to inform employees of the company’s right to monitor calls and e-mails made using employer provided equipment. A good communications policy will eliminate any expectations of privacy.
- Authorization Form – regardless if your handbook is electronic or hard copy, it is absolutely vital to get every employee to sign a statement saying that they have received the handbook and understand that they must abide by its policies.
Some General Tips for Developing a Handbook
- The employee handbook may be the first document a new employee receives from his/her new employer, therefore employers should be mindful of the tone in which a handbook is written. Start off with a welcoming letter from the CEO or President, rather than jumping right into the “Employment-At-Will” language.
- Employment policies should be written for their intended audience. Avoid using legal terms, company jargon or acronyms that may not be understood by newly hired employees.
- Policies should be followed! Employers should not expect only employees to follow company policies as written, but they should follow them as well. If an employer does not follow its own set policies, a manual may become persuasive evidence in any litigation against the company.
- Policy manuals should be reviewed on a regular basis. Federal regulations change often, and it is vital that a manual remains up-to-date and compliant. Also, it is not a bad idea to send out a reminder to employees on an annual basis to review their policy manual and ask any questions they may have.
- Have local legal counsel review the company employee manual on a regular basis to make sure that everything is compliant with federal and state regulation – but don’t let them make any changes that turn the manual into “legalese”.
Yes, a well-crafted Employee Handbook is indeed a business necessity. It can be a vital communication link to employees. However, the task of creating an Employee Handbook should not be taken lightly. Employers should be committed to putting in the time necessary to develop their manual, updating it periodically and having it reviewed by experts to make sure that the handbook serves to reduce their risk for potential lawsuits.