An Employee Handbook – Don’t Operate Without It

An Employee Handbook – Don’t Operate Without It

By Gary Wartik
November 20, 2013

An employee handbook or employment manual is a book given to employees that contains information about company policies and procedures.  The employee handbook is an excellent document in which to bring together employment and job-related information which employees need to know, regardless of the company’s size.  Information such as holiday arrangements, company rules, disciplinary and grievance procedures, confidentiality requirements, use of the Internet, policies related to sexual harassment claims, and others are musts.

The handbook can also provide useful information to new staff as part of the induction process.  If the employer is covered by the U.S. Family and Medical Leave Act of 1993 (FMLA), generally fifty or more employees, a handbook must have information about FMLA.  While content will vary among businesses, a well written employee handbook gives clear advice to employees and creates a culture where issues are dealt with fairly and consistently.

Need for employee handbook

Federal and state laws and the growing number of cases of employee-related litigation against management, especially in California strongly reflect that a written statement of company policy is a business necessity for companies of any size.  To be direct, it either avoids litigation or at least contributes to management responding to claims by unhappy employees.  An effective handbook is an obvious and relatively inexpensive answer to the question, “How does a business protect itself against lawsuits based on employer and employee behavior?”

There are several key elements that businesses should consider before implementing an employee handbook.  One of the most important aspects of any handbook is that the document be kept current.  The California legislature offers an annual barrage of employment law changes, so the handbook must be reviewed annually.  As well, if a company has a number of employees in which Spanish, for example is the primary language, then it is recommended that the handbook be published in both English and Spanish.

Employee handbooks set expectations

Employee handbooks set forth expectations between the employer and the employee.  A handbook is a tool to provide clear boundaries for the employee and to let the employee know what his rules and benefits are. Employers can clearly communicate to employees how the employees should behave, what they should wear and how they will compensate, discipline and reward employees. Employees will understand their responsibilities and have a reference point for how to do their jobs and maintain their status.

Employee handbooks protect employers

Clear policies and procedures can prevent liability.  For example, California courts may consider an employee handbook to be part of the employment agreement, even if the employment relationship is “at-will.” If an employee has a dispute with an employer or gets a bad performance review, he may try to use the employee handbook as leverage or to prove some deficiency on the employer’s part. A well-written and clear handbook can protect an employer; it sets forth a structure so when issues arise, neither the employee nor the employer will be surprised by the outcome.

Vision Economics recommends that employers retain specialty employment law firms to write new employee handbooks, or at least review what may be prepared internally.  Please contact our office if a referral is needed.  For companies with existing handbooks, an annual review by a competent law firm is highly recommended.

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