Understanding and Using Employee Handbooks

While employee handbooks are common, it's a good idea to know how a handbook is defined, created, used and interpreted by both a business and its employees. A good employee handbook serves everyone in the workplace well.

An employee handbook is a document that can contain an employer's background information and company policies, rules, practices and procedures. The goal behind most handbooks is to promote success of a business and avoid conflicts. Depending on how a handbook is written and used, it can serve different purposes in the workplace.

Employee Handbooks, Function and Formality

An employee handbook isn't about formality or a slick presentation. The content is what really counts. Employers may draft employee handbooks themselves, use software programs or consultants. Employees need a handbook that is clear and accessible.

What Should an Employee Handbook Contain?

From an employer's perspective, a handbook should only contain provisions that are going to help with employment issues. Handbook disclaimers are important and impact how a handbook is used. For example, most employers don't want a handbook to function as a contract, and a disclaimer should say so. Most employers also want to include a statement that they are free to change the handbook at any time.

Employee handbooks serve several purposes for employees, including welcoming a new employee and providing some company history, detailing policies, procedures and rules, and express the employer's commitment to following employment laws. Common terms found in handbooks include:

• Rules covering all aspects of the work environment, such as dress code, phone use, equipment use, conduct and interaction with others and security issues
• Employee attendance, scheduling and absence policies, including holidays and vacations
• Compensation policies and practices
• Hiring, promotion, layoff and other termination policies
• Training policies
• Discipline policies
• Descriptions of employee benefits
• Discussion of job duties
• Employer policy statements on specific employment laws, such as the Americans with Disabilities Act (ADA) or Family Medical Leave Act (FMLA)
• A statement that employment is at-will

A handbook should reflect the needs of a business and actual employment conditions. An employer risks inviting legal trouble when "canned" handbook terms are used that just aren't a good fit for a business. Employers could take on unintended duties or obligations, and employees aren't given the information they need.

Legal Advice

An employer should seek legal advice from an experienced employment law attorney before finalizing its handbook to make sure the handbook expresses the employer's intent and doesn't run afoul of any employment laws. A lawyer can also give perspective and advice on legal strategies and issues that might not be so obvious. For example, handbook terms on probationary periods may be different if employees work on an at-will basis.

Handbook Receipts

It's best for an employer to get a signed, dated acknowledgment of receipt of the handbook from all employees. As an employee, expect to receive your handbook and sign a receipt on your first day of work. The receipt should say that you received, read and understood the information in the employee handbook.

Employee Lawsuits and Handbooks

Well-drafted employee handbooks are designed to avoid lawsuits. Lawsuits do come up on the issues of handbooks creating employment contracts and failure to follow handbook terms.

In most instances, for example, there should be a statement right up front stating that, unless otherwise agreed upon in writing, employment is at-will, which means that an employee can be fired at any time without cause. Even when no express employment contract exists, an employee may be able to prove that an implied employment contract exists based on handbook terms. So, it is important to highlight the at-will status of employees.

Employees may bring a wrongful discharge lawsuit if they believe that their employer failed to follow dismissal procedures as outlined in the employee handbook or if they believe they were discharged before the end of a term that was implied in the employee handbook.

Both employers and employees should remember that their employee handbooks can be a core tool in creating success at work.

Questions for Your Attorney

• How long and detailed should an employee handbook be?
• How can I change an existing employee handbook? Do I have to give employees a reasonable amount of time to adapt to the new policies?
• I didn't sign a receipt for an employee handbook when I was hired, so can my employer hold me to its terms?