If you ever question the purpose of an employee handbook, think again. They are an essential tool for HR leaders and it’s not just about setting policy and staying compliant. The best employee handbooks offer a reminder of a company’s vision and purpose and help employees throughout their tenure.
Here’s everything you need to know about why and how to create an employee handbook for your organization.
What is an Employee Handbook?
The handbook gives employees a detailed overview of policies that are specific to your organization along with other key procedures, guidelines and benefits. In a nutshell, it sets clear expectations for your employees while also stating your legal obligations and defining employee rights. The employee handbook can help protect your business against employee lawsuits and claims, such as wrongful termination, harassment and discrimination. The handbook is also a crucial introduction to your business for new hires, providing insights new hires understand your mission and values.
Creating an employee handbook from scratch can seem like a daunting task, but having one is essential to creating transparency and consistency across your organization. It can also keep you out of hot water. Still on the fence? Here are eight reasons your organization should have one:
- Introduces employees to your culture, mission and values
- Communicates to employees what is expected of them
- Educates employees about what they can expect from management and leadership
- Helps ensure key company policies are clearly and consistently communicated
- Showcases the benefits you offer
- Ensures compliance with federal and state laws
- Helps defend against employee claims
- Where employees can turn for help
Perhaps the most important aspect of your employee handbook is the
introduction of new employees to your corporate culture and how they
will fit in. This helps to foster a sense of pride and belonging,
which studies show will help employees become more productive in a
shorter period of time. The introduction section of an employee
handbook will answer these questions:
“What do we do that sets us apart?”
“How did the company get here?”
“What are we passionate about?”
“How can I, as a new hire, become a part of this culture?”
The introduction section sets the standard for the employment relationship in general, and provides a guidepost for the remaining policies communicated in the handbook.
A well-written handbook provides employees with a clear understanding
of their responsibilities. The handbook also serves as a compass for
the organization’s policies and procedures. For example, it advises
employees what the procedures are for requesting time off or a vacation.
It advises employees whom they should contact when they have an
unscheduled absence (and what the timing should be). It tells employees
whom to go to if they have questions about any of the specific policies
in the handbook.
The handbook also communicates an employee’s general responsibilities regarding safety, timekeeping and reporting. By providing clear, accessible information, handbooks ensure companies continue moving in the right direction.
An employee handbook provides objectives and leadership
styles, as well as management best practices, to foster healthy
management-employee relationships. It also outlines logistics, such as
timekeeping requirements, hours of work and pay periods.
Further, a complete employee handbook advises employees of their various
entitlements to federal and state leaves, such as the Family Medical Leave Act (FMLA) or Jury Service
Leave. These clearly communicated policies help to eliminate confusion
and inconsistencies that result when handbooks are silent on these
No policy is effective if it is practiced inconsistently. A handbook
will accurately communicate your organization’s policies regarding
employment, conduct and behavior, compensation and other policies and
procedures you follow. Most importantly, managers can
refer to the handbook when answering questions or making decisions
regarding your policies and ensure their answers and actions are
consistent with your policies and best practices.
Does your organization offer vacations, 401(k), health insurance, paid
parental leave or other benefits to employees? Make sure they know about
these policies and the eligibility requirements by communicating them in
the handbook. A robust benefits package can help you retain your best
and brightest employees, so be sure they know about your full suite of
offerings by communicating these in the handbook.
No matter what state you do business in, or how many employees you have,
you will be subject to state and federal employment laws. Your handbook not only communicates these various entitlements and obligations to employees but is useful in demonstrating that your organization strives to be compliant with these regulations. For example, if your
employee is called away to active-duty military service, you will want
to be sure they understand their rights and obligations when
communicating their reason for taking leave. Your Military Leave Policy
should clearly define these parameters to the employee. Similar policies
should communicate rights and obligations regarding state disability
leaves, federal FMLA leave, and other government mandates.
Unfortunately, employers should consider it a matter of when, and not
if, they will face a lawsuit or similar challenge from a current or
former employee. When this happens, one of the most useful documents you
can provide your attorney or third-party investigator will be a copy of your handbook. A thorough and compliant employee handbook will help to
show that the organization exercised “reasonable care” towards its
employees. The employee’s signed acknowledgement page will show that
the employee had an opportunity to familiarize themselves with the
organization’s policies, a chance to ask related questions, knew whom
they could turn to for help within the organization, and agreed to
follow the terms and conditions of employment set forth by the
Ultimately, you want employees to feel comfortable turning to a
trusted member of management for help when they want to report
workplace violations, obtain workplace-related assistance and get answers
to any other questions they may have. The alternative is for them to
turn to an outside third party, like the EEOC or DOL, which could
trigger a costly and time-consuming investigation. When a handbook not
only outlines one or two management individuals for an employee to turn
to in these situations, but also designates another individual to turn
to in the event the employee disagrees with the first decision, they are
more likely to keep their complaints in-house, and this is a good thing
When was the last time you reviewed your policies and updated your employee handbook? Or do you need help creating one but aren't sure where to start? Searching for the answers you need online is time-consuming and inefficient. Plus, can you really ensure the information is accurate?
How Paycor Can Help
When it comes to trusted HR expertise, turn to Paycor for help. Paycor's HR Support Center is a comprehensive HR resource that provides organizations access to employee handbook templates, sample job descriptions, useful checklists, law alerts and more. Plus, dedicated support from an HR expert is always available with HR Support Center On-Demand. Want an HR expert to review your handbook policies? Have questions regarding an employee's behavior? The support you need is only one phone call away.
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