Why Employee Handbooks Are Good for Business

Whether you’re launching a startup or are at the helm of a multigenerational company, a policies, and procedures manual can help protect your business and set your employees up for success. Here’s what you need to know about the business document every company should have on file.

A Fundamental Business Document for Employers

Although its name may imply differently, a carefully crafted “employee handbook” is one of the most useful tools a business has to guard against employment disputes with employees and defend against discrimination or wrongful discharge claims.

The document itself is not a legal contract between an employer and employee, but the policies inside consider state and federal labor and employment laws and, when consistently followed and applied by employers, add a layer of protection for businesses around complicated workplace issues. Because a handbook conveniently houses policies and procedures in one comprehensive document, it is also an essential reference for managers and supervisors.

A great handbook has the potential to be a powerful recruitment tool too.[1] Prospective employees are eager to understand how a company will handle certain situations (What if I get pregnant (or my spouse does)? What if I am deployed? How do I know this company will treat me fairly?). The handbook tells them what to expect of company culture, which can be a differentiator in competitive labor markets.

Valuable Information for Employees

While at its core a well-written handbook is a compliance document to help protect a company from possible legal challenges, it is also an invaluable blueprint for employees navigating the workplace.

Many handbooks begin with brief descriptions of company history, vision, and goals. These elements lay a foundation for the policies and procedures to follow and help employees better understand their role in the larger organization. On a more practical level, the document provides workers with the information they need to successfully perform their jobs and explains the consequences they face if they don’t hold up their end of the deal.

Guidance about how to engage employers around sometimes difficult topics, for instance, how to report concerns, can be particularly helpful. Some experts suggest that when a handbook strikes the right tone – that is, when it’s written in a friendly, positive voice emphasizing a company’s culture, values, and perks – it can strengthen the employee-employer relationship and boost employee morale.[2]

Employee Handbook Essentials

An employee handbook covers a range of topics from work hours and attendance rules to harassment and discrimination policies. The Texas Workforce Commission, the state entity charged with overseeing workforce development, advises companies to include all personnel policies and procedures in a handbook organized into these broad categories[3]:

• Employer expectations – Attendance, leave, job requirements, drug policy, social media policy, etc.
• Employee expectations – Compensation, benefits, grievance procedures, equal employment opportunity, sexual harassment, right to privacy, etc.
• Administrative issues – Changes to the handbook, representations, disclaimers, etc.

The Commission offers several resources to help employers understand Texas workplace management laws. By the Commission’s admission, these resources are not intended as legal advice. It is essential companies work with a licensed attorney to navigate the complex legal requirements related to labor and business laws.

Our team will help ensure your employee handbook is valid and won’t just collect dust on a shelf! Here are our top five tips to ensure your policies and procedures document is read, understood and referenced:

• Tailor policies to meet your actual business needs. It may sound cliché, but there is no such thing as a “one size fits all” policy manual or employee handbook. All employers must abide by state and federal labor laws but are otherwise generally afforded the right to establish policies tailored to specific business goals. Let our experienced team help you determine which policies and disclaimers should be included in your employee handbook.

• Use clear and concise language. Employees are unlikely to understand (let alone read) unclear or superfluous policy language riddled with legalese. Instead, we recommend using short, straight-to-the-point sentences to eliminate ambiguity. We’ll ensure the handbook still addresses all legal considerations and requirements to protect your business.

• Make it a collaborative process. Allowing your team to participate in the handbook development process and providing opportunities to submit feedback or proposed changes can go a long way to build trust.

• Educate employees about what your handbook says and how to use it. No matter how well written your handbook, it serves little purpose if no one reads or understands it. It’s common to require employees to sign a simple form acknowledging receipt of the handbook and agreeing to comply with company policies. To help encourage widespread employee adoption and understanding, many businesses also invest time to train supervisors about how to use the handbook.

• Update your handbook regularly, as laws or business needs change. Even the most comprehensive policy handbook can’t anticipate ever-changing workplace laws. It’s good practice to review policies annually and make sure employees are aware of those amendments.

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[1] Geri Spieler, “Does Your Employee Handbook Reflect Your Company Culture?,” Huffington Post,www.huffingtonpost.com/geri-spieler/does-your-employee-handbo_b_12204922.html, (Sept. 30, 2017).

[2] William Craig, “How Positive Employee Morale Benefits Your Business,” Forbes, www.forbes.com/sites/williamcraig/2017/08/29/how-positive-employee-morale-benefits-your-business/ – 7fb028d02549, (Aug. 27, 2017).

[3] Texas Workforce Solutions/Texas Workforce Commission, Especially for Texas Employers, twc.texas.gov/news/efte/efte.pdf: 272.