Employee Handbooks: Are They Really Necessary?

Even though it isn’t a California or federal law requirement, many employers have an employee handbook or at least a few written company policies. Exactly where do those policies come from? The answer to that question is easy―the HR department. But where does HR get the policies that govern the company? The answer to that question isn’t quite so simple.

Employee policies can come from a multitude of sources, including style guides or boilerplate templates purchased online, but many times a policy is no more than an explanation of “that’s how we do things at this company.”

While in many cases a company means no harm by not having a formal employee handbook, the lack of a formal set of documented personnel policies can potentially lead to costly litigation.

Purpose of Handbooks

Employee handbooks can be a useful business tool when they’re developed correctly. They can: 

• Describe the employer’s expectations of employees;
• Spell out work rules;
• Be used as a management tool for supervisors; and
• Provide the company with an “affirmative defense” to litigation should the need arise.

Handbooks can also provide a venue for you to inform your workers of company values, describe benefit plans, and provide day-to-day guidance like employee dress codes.

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Employee Handbook ‘Must-Haves’

Regardless of your company size, there are several policies you should develop and include in a handbook or, at a minimum, provide to all employees. They include: 

• “At-will” disclaimer. A statement explaining to employees that employment isn’t guaranteed and the company can terminate their employment with or without cause at any time is vital. Most states have requirements about where and how the employment-at-will statement must be included in a handbook to keep the handbook from being interpreted as an employment contract.
• Equal employment opportunity (EEO) statement. You should craft a statement that outlines the company’s commitment to prohibiting all forms of discrimination against all categories of employees protected by law and reiterating that you will not discriminate in any employment-based decisions (for example, hiring, training, or promotions).
• Antiharassment policy. Harassment policies are not just for sexual harassment anymore but should include all types of behavior that could cause an unproductive work environment. Also, your antiharassment policy should clearly spell out multiple avenues employees can use to report inappropriate behavior.
• Family and Medical Leave Act (FMLA) policy. Employers that have more than 50 employees are required under federal law to provide their FMLA policies to employees in writing, so what better place to put that policy than in the employee handbook?
• Fringe benefits. A summary of benefits should outline the basics of each benefit your company provides and describe the eligibility requirements.
• Computer and phone privacy. Your handbook should include a policy to inform employees of the company’s right to monitor calls and e-mails on employer-provided equipment. A good communications policy will eliminate any expectations of privacy.
• Acknowledgment form. Regardless of whether your handbook is electronic or a hard copy, it’s absolutely vital to get all employees to sign a statement saying they have received the handbook and understand they must abide by its policies.

Tomorrow, we’ll look at some general tips for developing a handbook.

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