Why Every Business Needs an Employee Handbook

Even if you only have one employee, you want that person to know and understand your policies and procedures.  It is a huge mistake to assume that employees “ought to know” or “should know” what your rules are. If you want to hold people accountable for their behavior, while defending unemployment claims and minimizing the chances of lawsuits, your polices need to be in writing. Here is a list of policies that should always be included in a handbook and the reason for each one. This list is not all-inclusive; it is a representation of the policies that should be in every handbook.

Attendance policy: You want your employees to come to work, right? Crazy as it sounds, you need to tell people that their presence on the job is a requirement for employment and that there are consequences for poor attendance and tardiness. Also decide how many days you will tolerate “no call-no show” before you will terminate employment.

Bereavement days: You decide how many days off you will give an employee who has had a death in the family. You also get to decide whether those days will be paid or unpaid, and what family members you consider to be “immediate family.” If you wait until someone has a death in the family, you may end up making an emotional decision in the spur of the moment that sets a precedent for years to come.

Bullying:  Bullying in the workplace has become a major problem. If ignored, it often leads to harassment and legal action. Bullies create hostile environments, make other employees uncomfortable, interfere with productivity and contribute to employee turnover. They can damage a company’s reputation and image.

Cell phones: Unrestricted cell phone use at work is a distraction that interferes with getting the work done. Employees who are allowed to play video games, take pictures, talk on the phone to friends, post to social media and so on during work time are not being productive.

Confidentiality: Employees need to know what constitutes “confidential” information. If it is not spelled out, and employees give out this information, you may have no legal recourse.

Conflict of Interest: Are employees allowed to work for a competitor while employed at your company? Are they allowed to work for themselves doing the same work they do for you? Are they allowed to accept gifts /gratuities of any kind and in any amount?

Data Systems Policy: Your employees need to know that their on-line activity is not private and that any and all information on company computers belongs to the company. They should be educated on how to recognize a possible scam and how to avoid downloading a virus. They should be forbidden to install software not purchased by the company, be warned against copyright violations, and be warned not to take home copies of company programs.

Disciplinary Policy:  Employees need to know that there will be consequences for violations of company policy.

Dress Code: You need to set standards for proper dress at work. If jeans with holes are not acceptable, say so. If employees are required to wear a uniform, spell it out.

Driving on Company Business: It is important for employees to know what to do in case of an accident, but also that such things as speeding, texting while driving, and talking on a hand held phone are forbidden.

EEO Policy:  A policy forbidding unlawful discrimination should be part of any handbook.

Employment At-Will:  A properly written policy of employment at will is essential to maintaining a non-contractual relationship with employees. A supervisor’s off-hand comment can be taken to mean that an employee has some guarantee of employment. This can cause an employer enormous problems when dealing with a problem employee.

Employment Categories: Define what constitutes “full time” vs. “part time” so that there is no misunderstanding when it comes to benefits that are determined based on category.

Group Insurance Plans: If you offer medical, dental and /or vision plans, the handbook should only say that you do offer it, who is eligible (employment category), and when they are eligible. Do not go into any detail. Refer to the Summary Plan Description.

Harassment: It’s illegal. You absolutely must have a policy against it, a definition of what it is, examples of it, a reporting system, a policy against retaliation for reporting harassment, and a policy that states there will be severe consequences (up to and including employment termination) for willfully making a false accusation.

Holidays: If you offer paid holidays, state your policy including who is eligible and when.  If you are closed on holidays but do not pay employees, perhaps you allow them to use PTO. Private sector employers are not legally required to pay employees for holidays.

Jury duty: You must allow time off, but you are not obligated to pay hourly employees for time lost due to jury duty. Exempt employees who work any part of the week they are on jury duty must receive their full salary for the week.

Leaves of Absence: No matter how small you are, you need a policy on medical leave. Your policy should spell out who is eligible and when, as well as the maximum allowable leave. Small companies (less than 50 employees) often use 2-4 weeks as their allowable time. If your company has 50 or more employees within a 75 mile radius, you will need a full FMLA policy in your handbook.

Lunches and Breaks: Spell out your policy. If you don’t, then employees may feel free to take whatever time they want.

Medical Marijuana: If you have employees in a state that allows medical marijuana, you definitely need a policy forbidding marijuana use at work, being under the influence at work, possessing and/or selling marijuana at work.

Pay issues: Employees need to know how to keep track of their time, how often they will be paid, what the payday is, what the workweek is, and whom to contact in case of errors on the paycheck.

Paid Time Off, Sick Time, and Vacations: Whatever your policy is with regard to time off, it is very important to spell it out very clearly in your handbook. At the very least, employees need to know how much paid time off they will receive and how it is accrued/awarded, whether they can use paid time before it is earned, if they have to use it before requesting unpaid time off, how much rollover is permitted and whether earned but used time off can be “cashed out” or paid out at time of employment termination.

Right to Search: As a deterrent to theft, employers should reserve the right to search employees’ belongings, lockers, lunchboxes, and any vehicle on company property. The wording on this one has to be exactly correct to avoid violations of employee privacy.

Social Networking: This policy should be designed to give employees a clear understanding of what they are allowed to post on their own channels and what is off-limits. Without such a policy, your company is at risk of facing legal issues or even a public relations nightmare due to an account hack.

Solicitation: A Non-Solicitation policy is a way to reduce disruptions at work that occur when people are allowed to bring in things to sell (cookies, jewelry, crafts, etc) and they are allowed to approach co-workers during work time to try to sell these things. A non-distribution policy is intended to keep people from bringing in written materials, flyers, pamphlets, and so on and leaving them at work, thus causing clutter and extra work for the cleaning staff.

Substance Abuse: Abuse of drugs and alcohol is a reality that all employers must recognize and deal with. Unless you want employees coming to work “under the influence”, there needs to be a policy in place forbidding the sale, use, and possession of controlled substances at work.  Even if your company does not do pre-employment drug testing, you should still reserve the right to do testing for “reasonable suspicion” and following a worker’s compensation accident.

Violence in the Workplace: Employees need to know that your company will not tolerate violence in any form and that there will be consequences for violation of your policy.