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8 Steps to Creating an Employee Handbook People Will Want to Read
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Lorelei Yang image
Lorelei Yang,
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Wonky consultant with a passion for words
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An employee handbook is an important resource for a company's employees that details the policies, procedures, working conditions and behavioral expectations guiding their actions in the workplace. 

These documents ensure that employees always know what's expected of them at work, understand how their employer will address and apply policies and procedures, and know how the employer will handle problems and complaints.

For employees, a handbook is a valuable quick reference guide to a great deal of information they need at work.

6 must-have elements of an employee handbook:

Insperity suggests six clear policies that must be included in a strong employee handbook.

1. Employee code of conduct

This is arguably the most important part of an employee handbook: it outlines a company’s expectations of its employees’ behavior, including ethics and compliance. Thus, it gives employees a sense of how they’re expected to act and also sets the tone for a company’s culture. Some of the basic elements of a code of conduct are: a code of ethics, dress code and grooming standards, workplace safety protocols and attendance requirements.

2. Communications/technology policy

A communications or technology policy spells out a company's expectations around how employees use office technology and company-provided mobile communications (such as company cell phones and laptops). A communication policy can also include stipulations on employees' use of company equipment and the company’s internet to surf the internet for personal purposes, make personal phone calls, store photos, text friends or post on social media. This policy should make it clear that company anti-harassment, anti-discrimination and ethics policies extend to all forms of communication on all devices and platforms (including email and social media)

3. Compliance with nondiscrimination laws

State and federal law both protect employees from discrimination based on age, race, religion, pregnancy and disability. The company’s commitment to abiding by these laws should be explicitly stated in an employee handbook.

4. Compensation, benefits and leave

Explaining things such as payroll deductions, overtime, the Family and Medical Leave Act (a U.S. labor law requiring employers to provide employees with job-protected and unpaid leave for qualified medical and family reasons) and the company's workers' compensation policy in the employee handbook covers the company's legal bases. This part of the handbook may also detail how often employees will receive performance reviews

5. New hire and separation

An employee handbook should outline both the basic terms of employment and what employees should expect if leaving the company. This includes answers to questions such as benefits eligibility, pay frequency, transfers and relocation, required notice for quitting, whether there's a referral policy for new talent and at-will and discipline policies. 

6. Acknowledgment of understanding

An employee handbook should require employees to sign an acknowledgment of their understanding of the handbook in duplicate (one copy for the employee to keep, and one for the company to keep in the employee's employment file). This way, both the employee and employer have a record of the employee’s receipt of the handbook and a confirmation that they understand its contents.

8 tips for writing an employee handbook:

1. Make it clear that the handbook is only one of many resources for employees.

The employee handbook is a guide for employees to understand their jobs, but not the only resource for employees — and this should be made clear in the document itself. Explicitly tell employees that the handbook should be the starting point for answers to their questions, but that they should address questions to the company’s HR or HR equivalent.

2. Include policies for emergency situations.

Ensure that employees are aware of relevant safety and security procedures and stress that employees' safety and security is important to the company. Thus, the handbook should outline steps to be taken in the event a range of emergencies, including workplace injury, robbery, drug and alcohol incidents, criminal records and emergencies (including fire, severe weather or flooding). 

3. Get a lawyer to review the document before it’s finalized.

Once the handbook is drafted, have a lawyer conduct a legal review of the document before it's finalized and sent out to employees. 

4. Clearly describe expectations of employees.

As discussed above, the code of conduct and employee expectations sections of an employee handbook are critical expectations-setting elements of the handbook. Thus, all of your expectations of employees should be explicitly laid out in the handbook. This includes cellphone usage while on the clock, arrival time for work, clock in and out policies, shift switching, overtime and similar matters.

5. Spell out hours, benefits and compensation. 

The employee handbook should clearly outline: pay periods, what’s included on pay slips, employee benefits, employee discounts (if applicable), company holidays and time off.

6. Keep it as short as possible.

The employee handbook should be as succinct as possible. Bearing in mind that new hires will be reading other documentation, including legal documents, as they fill out necessary forms during the hiring and on boarding process, there's no need to reiterate everything in the legal documents — instead, the handbook can reference those documents and provide a summary if appropriate. Relatedly, you should try to keep the handbook relatively short: no more than 30-40 pages is a good rule of thumb.

7. Ensure it’s easy to read and use.

Use headings, sub-headings, bullet points and paragraph breaks to make the handbook easy to skim and reference specific sections in. 

8. Update it on a regular basis.

Schedule at least yearly reviews of the employee handbook to ensure that your handbook stays up-to-date with your company’s changing needs and structure. These yearly reviews are also an opportune time to solicit employees' feedback on the handbook and update the handbook to comply with any new federal laws or changes to the law.

What makes a great employee handbook?

Ultimately, a great employee handbook is a clear, useful and easily-referenced resource that guides a company's employees' behavior. The best employee handbooks are easy to read, well-organized and reflective of an organization’s values

For some inspiration, HR Partner has a list of five examples of the best employee handbooks. While you don't have to get as creative as Zappos, Netflix, and Valve did, their thoughtfully-designed handbooks are great ex

Are employee handbooks legally binding?

Generally, yes. According to LegalMatch, unless the text of the handbook clearly states otherwise, "an employee handbook can be considered a legally binding document between an employer and its employees." In most cases, courts consider employee handbooks to be extensions of employee contracts. This means that if an employer fails to honor the provisions of its handbook, an employee can sue the company.

Empowered with this information, you now have the tips you'll need to draft and disseminate your own employee handbook. When done right, a great employee handbook will benefit both you as an employer and your company's employees by ensuring that everyone's on the same page about expectations, setting the tone for the organization, providing a consistent message for employees, and strengthening the company's position if there's ever a dispute with a current or former employee.

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Lorelei Yang is a New York-based consultant and freelance writer/researcher. Find her on Twitter and LinkedIn.

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