The Employee Handbook is one of the most important documents and communication tools of a business. It sets forth the policies and benefits provided by the employer. The employee handbook expresses the philosophy, goals and ethical atmosphere that is maintained by the employer. A clear and unambiguous document describes what the employee can expect from the employer, and in turn, outlines the expectations the employer has of the employees. When drafting a handbook employers must exercise care. Factors such as word choice, policy selection and the consideration of applicable laws all have an impact on the effectiveness of an employee handbook. If developed and implemented incorrectly, an employee handbook can do more harm than good. Employers should avoid the common mistakes listed below.
1. Failing to regularly update your handbook. An employee handbook is a living document that needs constant examination and revisions. A factually inaccurate handbook or one that is not representative of actual practices can be as problematic as statements that are illegal. It is a good idea for an employer to update its handbook at least once a year.
2. No disclaimer. An employer should print a disclaimer stating that the handbook does not constitute an employment contract. An employer also wants something in the disclaimer that says that it is not a complete description of the employer’s policies and procedures. To cover your bases, the disclaimer should be in the front and the back of the handbook, in a larger font and in bold.
3. Not using straighforward language. An employee handbook should be written on a level that all employees will understand. If the handbook is too vague or too technical it may not serve its purpose.
4. Neglecting to detail anti-harassment and discrimination policies with reporting procedures. Employee handbooks provide an excellent means of conveying the company’s equal employment policies and practices for how alleged violations must be reported. As Supreme Court decisions have illustrated, well-drafted policy and complaint procedures to deal with harassment and discrimination issues will serve as a useful tool in limiting employer liability.
5. Not taking into consideration federal, state and local laws. An employee handbook should not just focus on federal law requirements. Often state laws provide greater employee protections (which is true for the state of Washington in many instances) than federal laws. An employer should also include relevant municipal ordinances.
6. Being too specific. A handbook should be a set of guidelines for the employees to follow. If a handbook includes lists or examples of behavior, it should be made clear that they are for illustrative purposes and are not exhaustive.
7. Ineffectively communicating the handbook to employees. An employer should never assume that employees will become familiar with the handbook on their own. Employers should set aside some time to discuss its contents with employees and answer any questions they may have. A review of the handbook should be included during the new employee orientation.
8. Failing to obtain an employee’s acknowledgment. An employer should have employees sign an acknowledgment to ensure that all employees have received, read and understand the handbook. The acknowledgment should contain language that employment is at-will and the employer retains the right, in its sole discretion, to modify, alter or amend the handbook at any time. The signed acknowledgment should then be placed in the employee’s personnel file.
9. Including language and buzzwords that are ticking time bombs. Policies should avoid words such as “only,” “always,” “shall” or “will” or phrases such as “termination only for cause,” promises of job security (”permanent” employee). An employer should use more flexible words such as “may,” “usually,” “generally” and “typically.” These words give more flexibility in interpreting and applying policies.
10. Not having the handbook reviewed by a lawyer. An employer should have an attorney who is well-versed in employment law review its employee handbook. An employment lawyer may identify areas that are not currently in the handbook but should be included, identify changes in current verbiage to make the handbook legally compliant, and pinpointing policies that should be eliminated.
Remember, a well-crafted and up-to-date employee handbook can be used as an effective tool to minimize both litigation and liability.
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