HR Policies & Procedures

Keep Your Human Resources Policies from becoming HR contracts

If your Human Resources policies manual doesn’t carry the proper disclaimer, you may find yourself unable to change key HR policies unless your employees agree.

Business is built on contracts. Between companies and customers. Between manufacturers and suppliers.

They’re a great way of to ensure, that even if conditions change, price, delivery or whatever else you agreed to will be as when the contract was signed. The terms are locked in.

Which is precisely why contracts between employers and individual employees are rare. Employers want the right to staff up or down, or change job responsibilities, salaries and benefits and other human resources policies to fit their changing business needs.

My HR manual a book of contracts? Could be.

The problem is that you may have a book of contracts with your employees on your office shelf right now. You may not think of your Human Resources Policies manual that way. But if that HR policies manual lacks certain key features, a court might just take that view. You might never be able to change vacation policy, for example, or modify your appraisal system or wage increase calculation, or revise other HR policies you’ve set, unless your employees agree.

The key to avoiding this was spelled out in a court case called Orback et al v. Hewlett Packard, as well as other cases.

The key in the Orback case was that the company was able to show that, unlike an employee handbook, which is a communication to the total workforce, its human resources policies manual was intended only for supervisory and management personnel, never for employees or third parties. The fact that the HR manual was only for the company’s leadership undermined any claim that it was a contract with employees. They were not even able to see it, so how could they claim a mutual agreement with employers on it?

Elements of a proper HR policy manual disclaimer

That’s why BLR’s experts recommend that your HR policy manual carry an absolutely clear disclaimer, preferably in large black letters, on a front page. The disclaimer should include the following elements:

  • This Human Resources manual is for supervisors and managers only, and must not be given to or shared with non-supervisory employees or third parties.

  • The policies in this HR manual specifically do not constitute a contract with any employee, supervisor or manager, or a contract guaranteeing any benefits or agreeing to maintain any procedures or policies contained.

  • The policies in this manual supercede any previous policies published on the matters they treat.

  • The company reserves the unlimited right to change or revise the content of the manual, at any time, and in any lawful manner, without prior notice.

Of course, as always, you’ll want to check with your company’s legal counsel to be sure your disclaimer has the precise wording that fits your needs.