Employee Handbook and What You Should Put in It
An employee handbook is not just a bunch of paper you hand off to your new hires. It serves as a guide for the employer/employee relationship, as well as describes the policies and procedures that your employees need to follow in the workplace.
A good employee handbook can serve many purposes. It can set expectations for both the employee and the employer. It can go into detail about wages, benefits, and other details that will be important for your workers. It can also help protect your business against potential litigation and ensure compliance with various laws.
What Businesses Need an Employee Handbook?
All of them, really. While it’s not required that your business have an employee handbook, any company with at least 20 employees should have one. As your company gets larger, more laws start to affect your business, with a myriad of federal regulations kicking in at the 20-employee mark. Even more regulations take effect when your business hits the 50- and 100-employee thresholds.
Federal regulations aren’t the only reason your company should have a handbook. A handbook is a great place to house your policies. You can incorporate the handbook into your employee onboarding process so that you can review all your policies and procedures with them.
It’s also very important to have employees sign off that they received a copy of the handbook and that somebody went over it with them and they understand its contents. This can give them a greater understanding of certain expectations and help if there are any employee complaints or discrepancies in the future.
Of course, there’s a major difference between understanding that you need an employee handbook and knowing exactly what needs to go into the handbook. Employee handbooks should be highly customized to your business, there are several facets that should be staples in nearly all handbooks, whether they help educate your employees or keep your business covered.
Must Haves for Your Employee Handbook Guidelines
Company Mission Statement and Values
Your mission statement and values allow your new employees to better understand your company culture and what sets you apart from every other business. This allows them to learn what they need to do to become successful in your company – a sense of direction and purpose.
Benefits and Wages
Employees want to know their full range of benefits, any specifics on wage structures and the overtime policy. Unfortunately, this section isn’t just as simple as listing out benefit details or what forms employees can expect to fill out.
PTO & Holidays
It’s important to be very specific about your company’s paid time off policy. PTO policies can differ from company to company, so a clear definition can make your policy easy to understand for your employees. This can include definitions for:
- Accruing PTO
- When PTO accrual starts
- When employees can take PTO
- How much notice an employee must give before using PTO
- If PTO carries over at all
- What happens to PTO when an employee leaves the company
This section of the handbook can also include a list of official paid days off, including any holidays your employees can expect to have off.
Classifications of Employee
Correct employee classification is very important, both for you and your employees. This section will define the different employee classification at your company, such as salary exempt and non-exempt employees. This will help explain what benefits are offered to different employee classifications and when certain employees are eligible for those benefits.
COBRA is a federal law that applies to companies with at least 20 employees. Include a definition of COBRA so that your employees know the details of their group health plan coverage for a period of time after their employment at your company ends.
Equal Employment Opportunity
The Equal Employment Opportunity Commission laws make it illegal for employers to discriminate against applicants or employees because of race, color, religion, sex, national origin, age (for those 40-years old or older), disability, or genetic information. These laws apply to all work situations and, per the U.S. Equal Employment Opportunity Commission, affect most employers with at least 15 employees, while age discrimination cases affect businesses with at least 20 employees.
At-will Employment Statement
Depending on your state, you’ll want to include a section on at-will employment. If you’re in an at-will state like Ohio, this section will explain how the employee has the right to terminate their employment for any reason and that the employer also has that same right, but applied to the termination of an employee.
Americans with Disabilities Act
This law enforces that employers with at least 50 employees hire based on qualifications. Under this Act, discrimination against a disabled person is illegal in employment, transportation, public accommodations, communications and government activities.
Paid Maternity Leave
Your handbook is a great place to list out specific details for your company’s paid maternity leave policy. Cover the specifics for the maternity leave process, including how long workers can be out, when employees need to notify their employers, and other important details.
This section covers the national standards for protecting employees’ medical information under the Health Insurance Portability and Accountability Act. Employers can’t share private health information, nor are they allowed to discriminate against employees for that information.
The Family and Medical Leave Act affects companies with at least 50 employees. This section explains that under federal law employers are required to provide protected, unpaid leave for certain medical and family reasons.
Substance Abuse & Drug Testing
If your company has a policy on substance abuse and conducts drug tests, you’ll want to outline the specifics of your policy. Employers must follow the state’s rules about providing notice and following procedures intended to prevent discrimination and inaccurate samples.
With the legalization of marijuana in certain states, you will also have to work with an attorney on how that may affect your policy. This is also a section that may need to be updated frequently with new legislation and updates.
Employers need to be aware of laws around employee document retention to better protect the privacy of employees, such as medical information or I-9 forms. In the old days, employers could keep a single file on a worker. Now certain documents must be kept separate from other information. This is done so auditors can come in and review specific areas without seeing unauthorized documentation.
Of course, these documents can change or require new information. One recent update is that new hires must fill out the new version of the I-9 form and provide the necessary supporting documentation. This all needs to be completed within three days of an employee’s start date and stored electronically or in paper form. Your handbook must be updated to reflect this new I-9 update for any employees with a start date of Jan. 22, 2017 or later.
Don’t Copy and Paste – Customize Your Employee Handbook
Now that you know how important a handbook is for your company, it’s time to put it together. However, it’s not quite as easy as copying and pasting from other handbooks. In fact, that can lead to major problems.
Borrowing language from free employee handbook templates or other business manuals can be a dangerous practice. We’ve seen companies with handbooks that contain benefits that the company doesn’t even offer. It’s better to use a general policy as a guide and then tailor it to fit your company.
The Society of Human Resource Managers (SHRM) is a great resource for templates and ideas of what to put in your handbook and how to word it. From there, customize your handbook section by section according to how your business works and what you offer to new employees.
Get Your Employee Handbook Reviewed
When you think you’re about done, make sure to have an employment attorney read over the handbook. They can point out any problematic areas that could discriminate or show favoritism and sign off on the handbook when it’s ready to be rolled out to employees. The cost of an employment attorney is worth every penny to help you avoid a dispute with an employee.
You also must realize that your handbook is never truly done. A handbook is a living document that will need to be updated as your company grows and adapt to any changes in the world of business. Make sure to update your handbook to reflect any new legislation, trends, or other changes that may affect you and your employees. The uncertain future of the Affordable Care Act and the updated I-9 forms are just a couple of factors that can change your documentation and compliance needs. Follow Apple Growth Partners to stay up to date on big news that may affect your business.