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What Information Should A Company Include In Its Employee Handbook?

Article by Mark Sottile, Esq. 

Employee handbooks serve a variety of purposes. While handbooks serve to establish expectations for employers and employees, they can also serve as a means of defense in employment-related litigation—if they have been drafted and utilized appropriately. Conversely, if a company lacks an employee handbook, if a company’s handbook is inadequate, or if a company does not apply and enforce its handbook consistently, it may find itself facing liability risks that could – and should – have been avoided.

Why Adopt an Employee Handbook?

An effective employee handbook will address a broad range of topics, including topics pertaining to the company’s professional and altruistic goals, equal opportunity employment, the nature of the at-will employment relationship (if applicable), and the general purpose of the handbook itself. With this in mind, some of the primary reasons why companies of all sizes should adopt employee handbooks include:

  • Providing guidance to supervisory and management personnel regarding implementation of company policies and procedures in the workplace;
  • Setting expectations among all company personnel with regard to matters such as compensation, paid leave, advancement, discipline, and termination;
  • Documenting the company’s commitment to preventing harassment and discrimination in the workplace, and establishing clear procedures for employees to file complaints;
  • Demonstrating the company’s compliance efforts with regard to its obligations under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act (ADA), the Family and Medical Leave Act (FMLA), and other pertinent state and federal laws; and,
  • Establishing a roadmap for the company to follow in order to mitigate its risk of facing liability in employment-related litigation.

What Should an Employee Handbook Include?

When drafting an employee handbook, there are several issues to consider. Crucially, companies must address these issues with their particular workforces, priorities, and legal obligations in mind. A cookie-cutter employee handbook will not be effective and adopting a “form” handbook can actually be counterproductive to achieving a company’s goals and mitigating its risk of employment-related liability in many cases.

So, what should an employee handbook include? Here are some examples of key issues that most companies will need to address:

At-Will Employment

For employers that have offices in at-will employment states such as Pennsylvania, clearly delineating the terms of their at-will employees’ employment is essential. Many at-will employees mistakenly believe that they can only be terminated for cause. By dispelling myths such as these in their employee handbooks, companies can set appropriate expectations and reduce the chances of facing unwarranted—yet still costly—allegations of wrongful termination.

ADA Accommodations

Under the ADA, employers must provide reasonable accommodations to qualifying employees with disabilities. Since employers must address requests for ADA accommodations on a case-by-case basis, handbooks should not address any specific types of accommodations, but instead outline the steps employees can take to submit a valid request.

Religious Accommodations Under Title VII

Under Title VII, employers must also provide reasonable accommodations to employees whose sincerely-held religious beliefs conflict with the regular performance of their job duties. Here, too, employee handbooks should focus on outlining the process for submitting a request and engaging with the employer to develop a suitable accommodation.

Performance Reviews

A company’s employee handbook should clearly define its standards for performance reviews. While specific expectations may vary between departments and positions, a company’s handbook should make clear that all reviews will evaluate pre-defined criteria pertaining to employees’ performance and attitude—and not any discriminatory or other impertinent factors.

Infractions and Discipline

A company’s employee handbook should also clearly define what constitutes an infraction that may subject an employee to discipline. Common examples of infractions include:

  • Lateness
  • Insubordination
  • Poor performance
  • Theft
  • Use of drugs or alcohol
  • Possession of firearms
  • Failure to call or show up for work
  • Harassment

An employee handbook should establish disciplinary standards and procedures as well, and it should make clear that supervisory and management personnel are expected to impose discipline on a consistent and non-discriminatory basis.

Lay-Offs

While employers may terminate at-will employees for any non-discriminatory reason or no reason at all, it is still generally a best practice to document the reasons for individual employee terminations and reductions in force. A company’s employee handbook should outline objective criteria (i.e. poor performance reviews and seasonal lay-offs) and avoid criteria that seem objective but still present a risk for disparate outcomes (i.e. salary or tenure).