Hiring employees means creating rules for them to follow. How to write an employee handbook that can help you run a better company — and protect you in court.
When you’re launching a new business, writing an employee handbook probably isn’t the first thing about. But once you start hiring, and have enough employees to round out a company, you’ll start to realize that maybe you should actually put some rules down on paper. And then you remember the employee handbook you were given when you got your first job. You remember how you glanced at it, threw it in a drawer and never looked at it again. Except there’s one difference now — now, you’re the boss.
While an employee handbook is about as fun to write as it is to read, it can be one of your company’s most important documents. Where should you begin and what should you include? Here are five things you need to know.
A handbook can protect you in court
A business can be sued for countless reasons. You fire someone who doesn’t believe they deserve to be fired, and they lawyer up. An uncouth, discourteous employee makes a pass at another employee, who eventually takes you to court. In the United States, most civil rights laws apply to companies with 15 or more employees. Companies need to become aware of local, state and federal laws to ensure they are in compliance.
So a handbook is your chance to get everything in writing, to establish rules on virtually every topic you can come up with. Obviously, having everything in writing isn’t a guarantee you won’t land in court, but it can help demonstrate in court that you weren’t making up everything on the fly. And the justice system notwithstanding, writing up all these rules and thinking about how to handle each situation will probably help you run your business more efficiently. Can’t remember your own sick-day policy? Check the handbook.
Cover the gray areas
Like what, you ask? The Internet is here to stay, and it’s causing all kinds of new litigation. Make sure you develop policies that identity what is and isn’t acceptable. With the onset of social media and the Internet, where does work begin and personal life end? This is a new and growing issue.
Remember to consider the everyday workplace scenarios that still pose challenges, even if they are not legal issues. There is no law on the books that’s going to stop people from falling in love at work. Think about those gray areas that are open for interpretation. When is my vacation earned? Do I have to call in if I’m going to be out sick? What happens if I’m called on jury duty?
It’s only a guide
Some employees — and their bosses — misunderstand the nature of a handbook and treat it as a contract. But unless you want it to be, clarify at the outset that the handbook contains policies, and does not serve as a contract. Your opening pages might include a statement along the lines of this: The contents of this manual should not be considered a contract between the company and its employees. This is a summary of our policies, which are being offered here as a guide.
Why is this important? Well, consider the topic of employment-at-will. If you’re not familiar with the term, employment-at-will means you can fire an employee for basically any reason. There are some obvious exceptions like discrimination, of course. But if somebody is incompetent or the company budget calls for eliminating a position, as an employer, you probably want the freedom to let people go whenever you want. However, if your handbook lists specific reasons for termination, without the proper disclaimer up front, these could be interpreted as the only legal grounds for termination if the handbook is considered to be a contract.
Avoid endless lingo
The tone of the writing should match the company culture, but it should be professional. Even if the company is very lax and informal, it’s fine to have an informal tone, but you still want to make it professional and understandable. If most of your employees are high school graduates, you want to make sure you’re writing to the level that they will understand. Consult an employment attorney.
In the beginning; if you’re just writing 10 bullet points on a sheet of paper as an early outline, this might not be necessary. But once your handbook is finished, and if it’s pretty comprehensive, it’s worth the money to have an attorney review and approve it. A professional Human Resource Consultant may be able to guide you on the content and the laws as they apply to your state. There are state laws that are often overlooked, and if a company has employees in several states, those states may have different rules you need to abide by.
And once your employee handbook is finished, you should review it at least once a year. The world moves fast. Is your employee handbook up to date? If it’s time for a review or a re-write your employee handbook, contact me