Employee Handbook Basics

By Alex Fischer

If you have more than two employees, you simply can’t afford not to have a company handbook. Often called “Policy and Procedures Manuals,” handbooks are statements of business’ policies and can be the most important communication tools between you and your employees. The handbook provides an explanation of what you expect of your employees—as well as what they can expect from you. It also can protect you in legal disputes, as courts have considered an employee handbook to be a contractual obligation.

Although policies will pertain to companies differently, depending on size, number of employees and benefits offered, most handbooks should include the following sections:

Company Overview

Introduce your company—and motivate employees—with a few paragraphs about its history, growth, goals, ethics and management philosophy.

Legal Statements

Include Equal Employment Opportunity Policy Statement, Non-Discrimination and Anti-Harassment Policy, Americans With Disabilities Act Policy Statement, Conflict of Interest and Outside Employment Statement, any work confidentiality issues.

Compensation And Evaluation

Discuss performance management and compensation programs, performance evaluation schedule, payment of salary, overtime pay and employee referral programs.

Time Off Policies

This section includes policies for vacations, sick time, personal time, bereavement, jury duty, leave under The Family And Medical Leave Act (FMLA), parental leave and leave of absence without pay.

Benefit Information

Include information on health insurance, dental insurance, flexible spending accounts, group life insurance, long-term disability, retirement plan, 401(k) plan, and workers' compensation benefits.

Job-Related Issues

This section should include information regarding attendance and punctuality, drug and alcohol abuse, appearance and dress code, intolerance of violence in the workplace, responses to accidents and emergencies, internal complaint channels, e-mail and Internet policies, use of company equipment and computer systems, reference checks, smoking policy, and tuition reimbursement programs.

Leaving The Company

Make it clear early in employment the expectations and procedures in resignations, dismissals, including immediate dismissals and those other than immediate termination, post-resignation/termination procedures.

The purpose of your employee handbook is to communicate your company's policies to your employees. It doesn’t need to be fancy—a simple computer printout will be sufficient. It does, however, need to be clear and straightforward. The fact is that many lawsuits come about because companies don't have documented policies, and, without them, may open themselves up to charges of discrimination. Your handbook should rectify this and eliminate possibility for confusion or misunderstandings.

Know the Laws
You can save on legal fees by writing your company handbook yourself, but it’s essential that you have an attorney give it a final review to make sure you get it right. Before writing, make sure you are familiar with the laws and regulations, and don’t be afraid to consult with a lawyer on any topics that you don't understand. This will ensure that your wording is accurate and appropriate. It will also ensure that your policies are in accordance with federal, state and local laws.

Keep It Understandable
Likewise, your handbook should contain enough detail to avoid confusion, but not overwhelm. If you hand out other documents (for example, your insurance plan’s guide), it’s unnecessary to repeat the information. Add a note of where they can find the pertinent documentation.

Have Employees Acknowledge Receipt
Protect yourself and have your employees sign for the handbook when you hand it out. Create a brief document that shows that he or she received it and understands its contents. Once everyone’s on the same page, and guidelines are set that apply to all employees, you’ll enjoy a more organized and efficient workplace.