Every company relies on several essential documents such as nondisclosure agreements, company bylaws and a business plan. Yet just as essential, and sometimes overlooked, is the employee handbook.
Some small companies believe creating an employee handbook isn’t necessary, but without one, your employees may not understand what’s expected of them and your business could be left unprotected. Creating an employee handbook may not be fast and simple but it is not out of your reach. It just takes some thought, a plan and actionable steps to bring it all together.
What is an employee handbook?
Reference manual, road map or bible—no matter how you view an employee handbook, it is essentially a written document that provides your hires with information about your company’s history, mission, values, policies, procedures and benefits. According to SHRM, your employee handbook should guide your employees and be a communication resource for both them and your company.
What to Include in an Employee Handbook?
An employee handbook should be easy to navigate and informative while setting clear expectations for your employees.
- Table of Contents. Including a table of contents is a must, especially since employee handbooks can be long and packed full of information. Your handbook should also be digitally accessible, with links to each section so employees can navigate it quickly.
- Welcome and History. Nothing drops engagement faster than a company that makes an employee manual all about itself. Write your welcome in a way that is directed to your employees, including how they’re essential and part of a great team. Include a brief company history mentioning how your organization started, what sets it apart, its goals and how your employees impact your future success. Don’t forget to include contact information for HR, IT and employee benefits.
- Onboarding, Orientation and Training. While an employee handbook is a resource for all employees, it especially serves as a guide for new employees. Include information on your onboarding process like workplace safety, required training, a timeline for training completion and a company hierarchy chart.
- Legalese. Your employee handbook is the ideal place to cover all of the legalities of HR. Use a legal service to make sure your manual completely and thoroughly covers:
- Equal Opportunity Employment
- Americans with Disabilities Act
- Handling Complaints
- Conflicts of Interest
- Confidential Information
- Employment At Will
- Employment Classification
- Workplace Violence Prevention
- Employee Culture, Values & Expectations. Lay out your company culture in your handbook by describing workplace norms, values and expectations. Include information on your company’s policies about dress code, social media access, drug testing, attendance and expected behaviors outside of the workplace.
- Technology and Communication Policies. Laptops, mobile phones and social media are all integral to today’s workplace and as such, polices need to be in place for their use. Spell out where company tech can go, who can use it, who pays for mobile service, what’s considered appropriate use of social media and how to return tech hardware when an employee leaves the company.
- Compensation. How and when employees get paid is likely the first page your new employees will turn to in your handbook. Cover all the payroll basics by highlighting the frequency of pay, direct deposit information, bonus structures and reimbursements for travel and other expenses.
- Benefits. Create a section in your employee handbook that lists and/or summarizes all of the benefits your company offers its employees. Include such benefits as health, vision, dental, retirement, tuition reimbursement, maternity and paternity leave, employee discount program and health savings accounts. Don’t forget to highlight any unique benefits as it will tell new employees a lot about your company culture.
- Exit Procedures. It is just a fact that some employees will seek opportunities elsewhere. Make it easy on yourself by putting in writing the procedures taken when an employee decides to leave the company. These include:
- Notice of departure
- Exit interviews
- Health benefits upon leaving
- Retirement savings
- Final paycheck
- Combustive issues. Unfortunately, there are issues that HR must deal with that are uncomfortable and thus many times left undefined. Create a place in your employee manual that addresses combustive issues like employee dating, marijuana use in states where it has been legalized, accepting gifts, employee complaints and the like.
Handbook Provisions Required by Law
There are more than 180 federal laws that the U.S. Department of Labor administers and enforces for about 150 million workers. Some of these are essential to include in your employee manual, as well as how your company handles them.
- Equal Employment. Equal Employment Opportunity (EEO) laws prohibit specific types of job discrimination in certain workplaces on the basis of race, color, religion, sex (including pregnancy, gender identity and sexual orientation), national origin, age (40 or older), disability and genetic information. Spell out your company’s policies on EEO and consider using gender-inclusive pronouns in your handbook.
- Sexual Harassment. While sexual harassment falls under EEO laws, your employee handbook needs to define exactly what constitutes harassment, discrimination and retaliation and what actions your company will take to prevent it in the workplace.
- Family Care or Emergency Leave. Administered by the Wage and Hour Division, the Family and Medical Leave Act (FMLA) requires employers of 50 or more employees to give up to 12 weeks of unpaid, job-protected leave to eligible employees for the birth or adoption of a child or for the serious illness of the employee or a spouse, child or parent. This law only applies to employees who have worked more than 1,250 hours in the past 12 months; that’s about 25 hours a week. Your employee manual should outline how your company addresses emergency leave for each type of worker you employ.
- Wages and Hours. Under the Fair Labor Standards Act (FLSA), companies must pay overtime to nonexempt employees who work more than 40 hours a week. If you employ both exempt and nonexempt employees, your employee handbook needs to cover policies that address the compensation you give for both types of workers—whether that’s paying time-and-a-half or offering comp time.
The list above is not meant to be a full list of legal issues, but it sheds light on how much there is to consider from an HR legal standpoint. If you need legal advice, consult with your company’s attorney or use a service like myHRcounsel.
Clauses Every Employee Handbook Should Include
Aside from state and federal laws, your employee handbook should contain certain elements and/or clauses that will help protect you from litigation but also set standards and expectations for your employees. This includes:
- A solid at-will employment statement to avoid creating an employment contract with your employees
- A statement that policies found within the employee handbook may be modified at any time with or without notice to employees
- An acknowledgment page that the employee signs either electronically or physically that is stored in the personnel file
Create an Employee Handbook in 9 Steps
There is a lot of information that can easily overwhelm anyone who is trying to figure out how to write an employee handbook, as it’s not a small endeavor. Break down the process into easily manageable chunks. SHRM recommends using these nine steps to develop your handbook.
- Review Your Current Company Policies. The information added to your employee manual should be relevant and up-to-date. Look at your current company policies and determine what needs to be revised. By reviewing the policies you already have, you can also determine which ones are missing. Once your policies are updated, ask your legal counsel to review them, inserting the appropriate legalese, and use the final versions in your handbook.
- Create an Outline. Use the information in this blog to create an outline. Include company history, mission, disclaimers, legal policies and so on, and add important points you want covered in each section. Remember to include all of the policies that will keep your company compliant like EEO, Family and Medical Leave Act, FLSA and more. Need more help? Find a great employee handbook template online. SHRM offers a simple one that is free for members and another customization option.
- Write Easy-to-Read Summaries. Legal terms are necessary policies but can be hard to read; you don’t want employees skipping over essential information. Instead, write a summarized version of each policy that is information but uses everyday language and terms.
- Write the Handbook. Now that you’ve outlined the handbook and written your summaries, it is time to put it all together. Write your welcome and company history, add the policy summaries and link them to the corresponding legal documents. Remember your handbook should be succinct and focused.
- Review the Handbook. Designate a team that includes HR to review the entire document. Rework any sections that are confusing or too wordy. Keep in mind this document is essential in informing both new and existing employees, and should be easily comprehensible.
- Send It to Legal. Once your company has put its final stamp on the handbook, send it to your legal team for a final review. This is the step that can not only keep you compliant but protect you from liability; don’t skip it.
- Determine How to Publish. In this day and age, the need to find a publisher to produce a hard copy of a manual may not be necessary. PDFs and other online publishing tools make it easy for every company to publish and distribute a digital employee handbook.
- Distribute It to Your Employees. You’ve worked hard on this document and you want to make sure your employees not only have access to it but that they read it. Include the handbook with their onboarding materials and use your learning management system to require its review during training. Make the document available on the employee portal page of your HRIS.
- Review Annually and Update. An employee handbook is the best answer source for any question your employees have about your policies and procedures. Just as your policies change, so should your employee handbook. Update it each time you update a company policy and review it annually to keep it fresh and accurate.
Good Employee Handbook Examples to Copy
Imitation is the sincerest form of flattery. Take a look at some great examples of employee handbooks before you create your own. Just remember that each company is different and your handbook should reflect what makes your company special.
- Hubspot. Hubspot’s employee manual is a description of the company culture that is part manifesto and part employee handbook. Created in PowerPoint, it is easily distributed to employees and simple to read and understand.
- Zappos. Zappos created an employee handbook specifically with company culture in mind. It is a great example to use when trying to incorporate your culture but also make your employees the focus.
- Valve. Valve’s employee handbook is beautifully designed, easy-to-navigate and full of company information. Flipping through the PDF, you will find tons of ideas to incorporate into your own manual.
- Disqus. Disqus’ culture book delivers the company mission and history with eye-catching statistics along with an informative but easily understandable description of its products. It’s also funny and culture-forward.
Creating an employee handbook is a big step. The process needs to be given a lot of thought because the finished product should reflect your company at its core. Once you develop your employee manual, keep it safe and accessible by storing it in your Learning Management System.
Arcoro’s Learning Management software allows you to securely store your most important documents, like your employee handbook, online where your employees can access them 24/7. It also gives you the ability to upload customizable training plans and supports third party compliance courses so training on everything from sexual harassment policies to OSHA is easily covered. Contact us to see how it works.