Employee Handbook Pitfalls; Small Business Owners Beware

An employee handbook is an important part of making sure your small business runs smoothly.  Once you start to bring on employees, an employee handbook should be drafted, maintained, and updated to reflect your current policies as well as those required by law.  When reviewing an employee handbook for a small business client, I often see provisions included that, although are mandated by law, are not applicable because the small business does not meet the minimum number of employees or various other reasons.

The purpose of your employee handbook is to let your employees know what you expect of them.  Therefore, it may contain some general background about your company, but it should also contain your general policies and procedures.  There is generally no need to include an exhaustive list and explanation of all your policies.  Your handbook should be written in simple English so it’s clear to your employees what the policies are that they are to be held to.

One thing to be cognizant of when drafting your employee handbook is that your policies should be consistent with current law and possible rules and regulations which govern your business.  You also should be careful because some courts have held the policies in your employee handbook can create a contractual obligation to your employee.  To try to dilute a claim of contractual obligation, you may want to include a disclaimer that your employee handbook does not create a contract with your employees and also state that all provision, with the exception of the employment at-will section, may be changed by you, the employer, at any time without notice.

As you can see, drafting an employee handbook can be a tricky and difficult task.  Because of the nature of the relationships it can create and the level of customization that each small business will require, you might be wise to consult with legal counsel to assist you with drafting the proper employee handbook for your small business.

If you have questions about your employee handbook, Integrated General Counsel can help you determine your next steps.  If you are ready for a results-driven plan of action, contact us either by telephone at (925) 399-1529, schedule yourself into our calendar for an appointment at a time convenient for you, or complete the Contact Kristen form and we will get back to you.

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  1. This is very helpful information for new businesses.