How to Create A Foolproof Employee Handbook

An employee handbook is like “The Holy Grail” of your small business. This smallish book addresses the who, what, where, why, and how of your business operations. Your employee handbook protects you and your business by setting appropriate expectations and providing consistency for your employees if difficult situations arise.

Going without expectations for your employees is a risky endeavor. Business is all about calculated risks, but taking a wild gander with employees won’t produce the results you need to grow your venture. Ideally, employee handbooks address anything significant related to your company, employees, operating policies, and applicable laws – as well as how rules and policies are followed and/or enforced.

Learn about what to include in your employee handbook, and just as importantly, what to leave out of this important business document. Set up the right expectations for your employees so that there are no future misunderstandings.

Equal Employment Opportunity (EEO) Laws

If we could all be kinder and more loving, we wouldn’t need to legislate how to treat other human beings. For now, business owners must comply with EEO laws concerning all forms of discrimination and harassment in the workplace based on various protected classes under federal, state, and local law, such as race, color, religion, gender, sexual orientation, gender identity or expression, national origin, age, genetic information, disability, or veteran status.

Employee handbooks need to detail which laws are applicable, state that the company complies with them, and address employees’ procedures to voice concerns. Voicing concerns could be accomplished by filling out a form, consulting with a supervisor, or bringing something to Human Resources’ attention.

Compensation / Benefits

Business owners should also describe the types of compensation and benefits available to employees, including information related to eligibility and procedures for receiving them. Include any overtime pay policies and how and when payments will happen. Write in policies regarding how to find tax documents or other documentation related to compensation and benefits. The more detail you include, the less you will have to answer questions about it later on.

Wage increase policies are also important to employees. For example, you could have a policy that one year of satisfactory work must be completed along with an acceptable employee review before increases will be considered. Deductions for benefits (availability and eligibility for health insurance, retirement plans, and wellness programs) are also a much-valued part of an employment package. Go ahead and lay out your terms early on so that you and your employees know the score. This saves you as an employee from having to field questions six months after a new employee starts.

Also, take the time to plan a formal sick and vacation pay schedule so that there are no disagreements about what is acceptable. We all have our own ideas about how many sick days are normal for a person, but employers and employees who disagree create disunity that could be avoided with a well-done handbook.

Work Schedules

Explain your business’s policy regarding an employee’s work schedule. Discuss absences, attendance, regular and flexible schedules, punctuality, reporting, telecommuting, and how the company handles non-compliance.

Standards of Conduct

Describe expectations (and consequences) for employee conduct regarding:

Ethical behavior
Dress code
Demeanor
Communications
Disciplinary measures
Performance improvement programs
Termination
Anything applicable to government regulations

Physical Safety

Illustrate how your company complies with the Occupational Safety and Health Administration (OSHA) and outline how employees should report and respond to accidents, injuries, potential safety hazards, bad weather conditions, health and other safety-related issues.

IT Safety

It is also vital to address technology and internet security issues (involving both hardware and software) by having clear and concise rules stated in the employee handbook. Included in these rules should be steps to keep company data safe (e.g., updating passwords, installing firewalls, storing and locking computers when not in use, guidelines for installing anti-malware software, and policies regarding personal use of a business-owned computer).

Leave Policies

Describe your company’s policy on the various types of leave: medical leave covered under the Family & Medical Leave Act (FMLA), jury duty, military leave, vacation, holiday, sick time, bereavement, maternity and paternity leave, and any other types of leave your company offers. Make sure your company’s policies are compliant with federal and state laws.

Several other important topics you may choose to address in an employee handbook are:

Bonuses
Disability (long and short time)
Lunch and break periods
Performance reviews
Timekeeping policies
Workers’ compensation

Does Every Business Need A Handbook?

If you operate a sole proprietorship with no employees, a handbook isn’t necessary. However, if you add just one employee, the game changes. Every employee (even if it’s just one) needs to understand the company’s rules, what is expected of the employee, the consequences for failing to adhere to the rules, and any benefits the employee is entitled to.

Ensure that every employee receives a copy of the handbook and signs a document stating that he or she has read, understands, and will comply with the policies. There’s nothing like ending up in court and having an employee say, “I didn’t know that was against the rules….”

What to Do Next

If you need help creating a new employee handbook or revising your existing employee handbook, contact us. We are here to assist you so the relationship between you and your employees can be a happy and prosperous one. Employment Law is a field we specialize in, including: