Does Your Business Need An Employment Handbook?

Brad Smith • July 19, 2021

Is Your Business Required to Have an Employee Handbook?

The basic answer is no. There are no federal or state laws specifically requiring an employer to have an employee handbook; in fact, some employers choose not to have one. Although this is the case for some, not having an employment handbook can be extremely hazardous for your business.


A legally compliant and up-to-date employee handbook helps answer many basic questions that would otherwise burden your Human Resources supervisor. An employee handbook can also provide a great deal of legal protection in the event that your business’ policies or practices are ever challenged in court by an employee or regulator. Sooner or later you may be faced a lawsuit or complaint from a current or former employee for issues such as wrongful termination, harassment and/or discrimination. 


When this happens, one of the most useful tools you can have is a copy of your employee handbook. If you don’t have your policies and procedures in writing, an employee can argue that he or she did not know about a particular guideline, which will likely result in legal action.


Thus, creating and maintaining an employee handbook is a great practice for any business; and it is recommended to implement, and continuously revise your company’s employee handbook.

What is an Employee Handbook?

An employee handbook is a resource (usually a published or digital booklet) used to provide employees with information that, by law, must be provided to them in writing.


This includes topics like equal employment opportunity statements, office hours and overtime. The handbook provides your staff with a detailed overview of the policies that are key to your organization, along with additional procedures and guidelines.


The goal of any employee handbook is to set clear expectations for your employees, while also presenting your legal obligations, as well the employees’ rights and responsibilities. A handbook not only communicates these entitlements and obligations to employees, it also demonstrates that your enterprise is active in being compliant with government regulations.


It is important to remember that no matter where you do business, or how many employees you have, you will always be subject to state and federal laws that govern the employment relationship.

How to Write an Employee Handbook?

A thorough and compliant handbook will show your business is committed to exercising reasonable care toward employees. Additionally, this demonstrates that you want your business to be fair, by having the same set of rules for all employees and staff.


As a matter of best practice, it is important that each new employee receive a copy of the handbook, be required to read the components and acknowledge the document prior to their start date.


Once the acknowledgement has been signed, it should be stored in your systems within each employee record. An employee’s signed acknowledgement will establish that they had an opportunity to familiarize themselves with the company policies, were given an opportunity to inquire about any issues, and agreed to follow the terms and conditions of their employment as listed in the document.


Although there isn't a universal solution, as all businesses are unique, here’s a basic breakdown of what an employee handbook typically includes: Company Description, Mission Statement, Equal Employment Opportunity Statement, Office Hours, Timekeeping, Overtime, Attendance and Tardiness, Payroll Information, Sexual Harassment, Americans with Disabilities Act, Performance Reviews, Telephone/Email/Social Media Use, Discipline Procedures, Termination, Employee Benefits, Holidays and Vacations, Sick Leave, Personal and Paid Time Off, Family Medical Leave, Retirement Plans, Pension Plans, Workplace Training, Workers’ Compensation, Workplace Safety, OSHA Requirements, Employee Acknowledgement, and others.


Once you have drafted your employee handbook, here are some additional items you should look into executing: have an attorney review the handbook, give each employee a copy, make sure each employee signs as having received, reviewed and accepted the handbook, re-visit the handbook periodically, ask your employees for feedback on improving the handbook, and update any policies that have changed.

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