In the modern workplace, a well-written employee handbook is a necessity for all employers. An employee handbook allows employers to explicitly outline the policies and expectations of the workplace. This article will explore the reasons why employee handbooks are so crucial in the contemporary workplace.
- Complies with the Law. Over the past several years, the workplace has become heavily regulated and increasingly employee-friendly as a result of new federal, state and local laws. Consequently, employers must ensure that their employee handbooks are in compliance with all federal, state and local laws. An employee handbook is the place for an employer to demonstrate that their organization endeavors to comply with these regulations. For instance, employee handbooks must comply with federal laws such as the Family Medical Leave Act, which requires all employers with 50 or more employees to give up to 12 weeks of unpaid leave each year.
- Outlines the Compensation, Benefits and Time Off Policies. An employee handbook needs to outline the the employee’s compensation, including the pay schedule, overtime policy and paycheck deductions. By informing the employee of the procedure for getting paid, an employer can avoid potential problems later.
A robust benefits package can help an organization attract and retain high quality employees. An employee handbook can provide a listing of the benefits provided by the employer, and which employees are eligible for those benefits. For example, does the organization offer medical and dental insurance plans, or a retirement savings plan such as a 401(k)?
Perhaps most importantly, an employee handbook must outline the organization’s time off and leave policies. Many of these policies are required by law, so ensuring they are incorporated in the handbook is essential. For instance, New York State, New Jersey, and Connecticut law all require paid sick leave for certain employees. Having a written policy outlining paid time off and other leave policies, such as military leave, guarantees compliance with the law and informs employees of their rights. With new leave laws being passed frequently, employers also have a duty to keep apprised of these changes and making sure their handbooks are in compliance.
- Protects Employers from Employee Claims. Employment-related lawsuits can be time-consuming and expensive. Addressing disputes with employees can detract from the day-to-day operations of the organization. Further, these lawsuits can become extremely costly, disruptive and affect the morale amongst employees. In order to avoid employment litigation, employers must take a proactive approach.
Employers can protect themselves from employment-related claims by clearly setting forth expectations of their employees in the handbook, by comprehensively communicating what is expected of employees in the workplace. The handbook also serves as an outline for the organization’s policies and procedures, allowing supervisors to objectively enforce the rules. For example, a policy on tardiness will establish what will lead to corrective action if the employee is repeatedly late for work.
- Protects Employers from Sexual Harassment Claims. With the recent uptick in high-profile sexual harassment allegations, heightened societal awareness on the issue, and a new anti-sexual harassment law in New York State (see our newsletter article), employers must have well-drafted anti-harassment policies in their employee handbooks. A well-drafted anti-harassment policy explicitly forbids all instances of harassment in the workplace, and outlines a procedure for employees to report incidents if the employee believes he or she is being harassed. By maintaining a well-written anti-sexual harassment policy, employers provide themselves valuable legal protection against sexual harassment claims.
- Introduces Organization Values. An employee handbook is oftentimes an employee’s first introduction into the organization’s culture, and can be a valuable orientation tool for a new employee. The employee handbook typically includes an introduction section which briefly explains the history of the organization and its “mission statement.” This information helps employees establish a direct connection with the organization’s values, which in turn promotes a sense of pride in the employee to be a part of the organization. In addition, understanding the organization’s values allows employees to establish behaviors consistent with the employer’s standards, and foster their development as a vital member of the organization.
- Gives Employees Information on Where to go for Help. The employee handbook gives employees a primary source of information to consult when questions arise that can be easily answered without having to approach management. However, the handbook should also provide employees with a procedure on who to turn to when they have an issue or workplace problem. In these instances, the organization would prefer the employee to address the situation internally, so that the situation can be remedied quickly and efficiently. Internalizing disputes will ultimately lead to a more positive work environment and less litigation for the employer.
- Contains an Employee Acknowledgment Form. In order to get the legal protections outlined above, an employee handbook needs an acknowledgment form, which states that the employee understands and will comply with the policies in the handbook, and which must be signed by the employee.
In the modern workplace, where the landscape is becoming more employee-friendly, it is crucial that employers have a user-friendly employee handbook that is tailored to their operations. Further, an employee handbook is a “living, breathing instrument,” which needs to be reviewed and updated regularly (at least once every two years). Updating the handbook ensures that the content reflects current organization policies and is in compliance with frequently-changing federal, state and local laws.