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Risk Management & Compliance

Risk Control: Why an Employee Handbook is Key

Christine Batten, PHR
by Christine Batten, PHR on February 23, 2017

It’s important to make sure your employees know what they can expect from your company as well as what’s expected of them from day one. The best way to do that is to have detailed job descriptions, a thorough employee handbook and clearly outlined company policies.

It’s important that employees sign off on these items during their orientation to document they have received, read and understand them.employee handbook

Your employee handbook is the bible of your business. It establishes the rules and guidelines of your organization and explains certain legal obligations and entitlement. The handbook isn’t strictly informational, it helps with HR risk control and can protect employers from legal trouble — specifically discrimination claims.

Here are the primary elements to include.

1. Statements Like EEO and At-Will

Purpose: Explain the company provides equal employment opportunities (EEO) to all employees and applicants for employment without regard to race, color, religion, sex, national origin, age, disability or genetics or any other legally protected class.

2. Anti-Harassment/Discrimination

Purpose: Ensure employees’ awareness that the company is committed to providing a work environment free of unlawful discrimination and harassment, including sexual harassment. It is also important to advise employees on reporting procedures if they witness or are a victim of discrimination/harassment.

3. Workplace Violence Prevention and Security

Purpose: Assure employees the company is committed to preventing workplace violence and to maintaining a safe work environment. Make sure to outline the guidelines to deal with intimidation, harassment, threats or actual violence that may occur onsite or offsite during work-related activities.

4. Drug and Alcohol Policies

Purpose: While the prohibition of the use of (or being under the influence of) drugs and alcohol at work would seem obvious, most states require advance written notice to employees prior to doing any drug testing. The exceptions would be in the cases of pre-employment or post-accident. Additionally, it is important to indicate how you, as an employer, will handle a positive test or refusal to test. Be sure to treat all employees the same in the actions you take.

5. Code of Conduct, Conflicts of Interest Confidentiality/Trade Secret Information and Corrective Action

Purpose: This policy can explain the company’s desire to provide a structured corrective action process to improve and prevent a recurrence of undesirable employee behavior and performance issues. Applying these procedures equally to all employees can be a big help when defending an adverse action.

Here’s a couple examples of how having your policies outlined in a handbook could help back an employer who might otherwise have no defense:

Let’s say Sally sues her employer for harassment in the workplace. Sally says a co-worker harassed her for months and nothing was done about it. But Sally’s managers say they never heard a word from her about any problems, and since she signed the handbook acknowledging she could have reported it to four people, they believed she knew the procedure.

The idea that the employer is responsible for protecting employees from or remedying harassment only exists if the employer “knew or should have known” it was taking place. If the harassment or discrimination is never reported to them, their liability for not fixing it could be greatly reduced.

On the other hand, if you don’t document employee issues, you set yourself up for potential trouble.

Let’s say, for example, an employee was terminated for violating a policy, but you never documented the incidents. If the employee alleges he or she was terminated for some unlawful reason, the matter becomes simply a “he said, she said” scenario.

However, if you have the paper trail that shows all the events that led up to your determination to fire the employee, you have a better chance of proving you had a legitimate, non-discriminatory reason for the termination. Likewise, employers will rarely prevail at an unemployment hearing without documented policies.

That means, regardless of why you let someone go, they will likely be awarded unemployment benefits. Protect yourself. Make sure you have written policies, apply them equally and document when corrective or adverse actions are taken.

Here are a few additional items your organization may need to address in your company’s employee handbook:

  • Injury reporting
  • Personal relationships in the workplace
  • State-specific mandatory policies
  • Paid time off and other leave
  • Pay periods, work schedules, workweek, overtime
  • Cell phone use
  • Appearance/dress code
  • Use of company equipment/vehicles
  • Privacy, computer usage & email
  • Social media

If you’re thinking of creating a handbook or policy, let us help. Our team of HR experts will make sure you’re covered.

Navigating HR Roadblocks

Christine Batten, PHR
Christine Batten, PHR

Christine has over 20 years of HR related experience with a background in labor and employment law.