Does My Business Really Need an Employee Handbook?

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While not strictly required from a legal perspective, an employee handbook is an essential tool for employers. A handbook documents and clarifies internal policies, procedures, and expectations. Additionally, having employees sign an acknowledgment of the company’s handbook can also assist the company in defense of litigation, should it arise.

6 Reasons Why Every Employer Needs an Employee Handbook

An employer should have an employee handbook for several key reasons:

  1. Sets clear expectations: An employee handbook ensures that employees have a clear understanding of their roles, responsibilities, and what is expected of them while working for the company.
  2. Treat employees consistently: An employee handbook can help ensure consistency in how the company operates and how employees are treated. This is critical to avoiding EEOC or Texas Workforce Commission complaints over discrimination, wrongful termination, or harassment.
  3. Helps defend your business from employee lawsuits or complaints: If a dispute arises, the employer can refer to the handbook to demonstrate that they have followed company policies and procedures. All employees should be required to sign and acknowledge their receipt and understanding of the handbook upon joining the organization.
  4. Document the consequences of employee misconduct. The Texas Workforce Commission will ask for documentation of your discipline policy and procedures when addressing employee complaints. Again, it is critical that every employee sign a copy of the handbook attesting to their receipt and understanding of the policy.
  5. Inform employees of their benefits and your expectations: An employee handbook consolidates and communicates important information to employees, such as benefits information, leave policies, safety procedures, and more.
  6. Reaffirms compliance with state and federal laws: Your employee handbook communicates to your team that your business complies with all applicable state and federal laws, especially related to labor and employment.

First, the Disclaimers:

The first step in drafting an employee handbook is to clarify what it is not: An employee handbook is not an enforceable employment contract. Include a disclaimer at the outset of the handbook, advising employees that the policies contained in the handbook are guidelines only, the company has the right to modify or delete any provisions found in the handbook without notice, and that the employee’s employment relationship with the company is at-will.

Additional disclaimers may be necessary given your particular industry. A business law attorney can advise you on legal disclaimers recommended for your business.

Which Policies to Include in Your Employee Handbook

Once the disclaimers have been laid out, next turn your attention to your company’s policies.

Broadly speaking, there are two types of policies that your handbook should cover: required policies and recommended policies.

For required policies, you and your attorney should outline which state and industry-specific laws govern your company if any, and determine what written policies are necessary. These written policies may be required whether you have an employee handbook or not. For example, some states require employees to maintain written anti-sexual harassment policies, as well as written policies rewarding leaves of absence. An employee handbook is a sensible and convenient way to communicate required written policies.

Recommended policies are policies not required under any law, but rather are advisable to clarify expectations and avoid disputes or complaints. These policies can include but are not limited to:

  • Anti-discrimination policies;
  • Anti-retaliation policies;
  • Reasonable accommodation policies;
  • Employee leave policies;
  • Wage and hour policies;
  • Workplace safety policies;
  • Employee conduct and disciplinary policies;
  • Termination of employment policies; and
  • Employee benefit policies.

Custom Policies to Include in Your Employee Handbook

In addition to the usual collection of required and recommended policies, your attorney may also suggest policies unique to your business model or business environment, such as travel policies, confidentiality policies, a social media policy, firearm policy (for Texas and other states), remote working policies, or holiday schedules.

Employee Handbook: Your First Line of Defense in Employment Disputes, Such as Harassment or Wrongful Termination Claims

Should a dispute between the company and a current or former employee arise, one of the most useful documents available is the company handbook. Having written policies in place that are acknowledged by employees shows that the employee was aware of the relevant policy, had a chance to ask questions, understood what resources were available to them, and what some of the terms and conditions of their employment were.

A well-written handbook also guides managers to treat every employee consistently and outlines a clear disciplinary framework for violation of company policies.

At Hendershot Cowart P.C., our attorneys can assist you in identifying and outlining required and recommended policies to include in your employee handbook or assess your existing handbook for critical gaps that could leave you open to miscommunication and employment claims.

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