Employee Handbooks, Part 1: 6 Reasons Why Your Company Needs an Employee Handbook

An employee handbook is a valuable resource. Every company is subject to local, state and national employment laws, but these regulations typically set minimum expectations. A handbook assists with informing employees about what is necessary for their success. For the employer, a handbook enables the employer to set expectations, decreases the frequency of misunderstandings, and defines standards for professional conduct. For staff, it allows them to learn about the company, what to expect, what is expected of them, their responsibilities, and more. Having a detailed employee handbook can prevent employment problems altogether, or be used as a shield against any potential unemployment claims or lawsuits.

Here are 6 more reasons why having an employee handbook should be a priority for any company:

Establishes Corporate Values

Most employee handbooks begin with an overview of a company’s history, information about the founders, and the mission of the company. This section gives your employee an introduction to the company’s values, and what an employee can expect to gain from and contribute to the corporate culture.

Defines Scope of Employment

If your company has contractors and employees, then the handbook should define the rights and duties associated with those positions. Part-time staff, for example, would be considered “contractors,” with their compensation reported to the IRS with form 1099. The handbook should inform a contractor that the company will not be withholding taxes, request a completed form W-2, and state that contractors are not eligible for unemployment, medical benefits or paid leave.

Sets Policy Expectations

A well-written employee handbook will offer the employee a clear definition of responsibilities and expectations for staff, with consequences for failure to meet those requirements. It should also detail procedures for taking leave from work, whether planned or unplanned, using personal electronic devices, dress codes, and timekeeping procedures.

A handbook should also define the employer’s responsibilities, such as pay rates, overtime policies, and pay periods, allowing for absence for illness, family medical issues or parenthood, bereavement, jury duty or military reserve, defining when leave is paid or unpaid, and prohibiting harassment or retaliatory conduct.

Communicates Company Benefits

In the handbook’s section defining employee benefits, the employer should include enrollment details and benefit options. If available, employment benefits like medical insurance and retirement options should be identified and defined. This section should explain any probationary period, and define when these benefits become available to a new employee.

Acknowledges Employee Responsibilities

It is important to note that an employee handbook should always include an “Acknowledgement,” where the employee signs off that they have read, and agree to, the handbook, and accepting disciplinary action including termination should they violate company code or policy.

Fights Unemployment Claims & Lawsuits

In the event that an employee files an administrative claim or lawsuit against the company, the employee handbook, along with a signed acknowledgement from the employee, may serve as valuable support. For example, unemployment claims can be defeated if a terminated employee was given proper notice of a rule violation, warned that violation of that rule would result in termination, and terminated for cause. Being able to prove that an employee was aware of company policy and knowingly violated the policy can save time and expense.

Contact Us

If you own a business and do not have an employee handbook, or your current company handbook has never been reviewed by an attorney, we can help. Protect your business against administrative claims and lawsuits by making sure that your policies are legal, and that your employee handbook is enforceable.

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