By: Jonathan Driggs
Small employers often struggle to know when it’s time to put an employee handbook in place. Very small employers (and even those that are a little larger) often feel that their operations are not complex enough to require a handbook—and the more casual “family feel” of a smaller organization could be impacted by having formal policies in place. Nevertheless, the time comes for most organizations—through growth or other changes—when it becomes prudent to issue an employee handbook.
At a minimum, employers with 15 or more employees should seriously consider creating an employee handbook if they haven’t already done so* (or otherwise creating a collection of important policies on key issues to distribute to employees). The reasons for this include:
- Federal and Utah employment discrimination and harassment laws apply to employers with 15 or more employees. As a result, such employers should have a comprehensive “Equal Employment Opportunity” policy that covers discrimination, harassment (sexual and other unlawful types) and disability accommodations. Not having such a policy could lead to increased liability exposure for the employer—were a charge of discrimination or harassment to be filed, the EEOC will not respond favorably to an employer who does not have an EEO policy in place (for a complimentary copy of an EEO policy, go to www.jkdlawpc.comand click on the “Resources” tab).
- The employer is now of sufficient size that it is important to formalize certain issues regarding the employment relationship, compensation and other fundamental issues (in other words, based upon their size, it is only a matter of time before some common problems arise if certain issues aren’t addressed). As a result, the employer should at a minimum have formal policies regarding:
- At-will employment (to avoid wrongful termination claims)
- Standards of conduct (to avoid a wide range of claims, including reducing exposure to unemplyment claims.
- Paid leave programs (to avoid wage claims)
- Use of company provided communication systems and property (to avoid invasion of privacy claims and preserve the employer’s right to monitor usage)
I find that many small employers are understandably nervous about creating an employee handbook. The most common concerns expressed include:
- Employee handbooks are a double-edged sword—employers can be sued for not complying with the terms of the handbook. This can be true. However, the solution isn’t necessarily found in not having a handbook (and there are a lot of legal risks in not having one!) The solution is in making sure the handbook is written correctly to avoid making contractual promises. In other words, the handbook isn’t the problem; it’s the content of the handbook that causes the problem.
- We like the flexibility of not having to regulate everything that goes on in the workplace. We don’t want to have to create this big, lengthy handbook that addresses every possible problem that can happen. There is some confusion on this point: employers (especially smaller ones) do not need lengthy, tedious handbooks. Nor do they need to have a policy on every possible issue that could come up. The key is to address the fundamental issues in order to protect the employer and provide helpful guidance to employees. Employee handbooks for small employers should be, um… small! (And frankly, regardless of an employer’s size, to be effective, employee handbooks should be shorter rather than longer.)
Since most of us didn’t necessarily take “How to Write an Effective Employee Handbook 101” in college, next time we’ll discuss practical do’s and don’ts for the often mysterious and frustrating process of putting handbooks together (hint: it doesn’t have to be too mysterious and frustrating!)
*This should not be construed to mean that employers with less than 15 employees do not need a handbook (or a collection of key documents or policies). At a minimum, every employer regardless of size should confirm in writing the at-will nature of the relationship, clearly define terms of compensation (including the terms of any paid leave programs), and confirm ownership and right to search any company provided communication systems.
This article should not be construed as legal advice. Copyright ©2011 by Jonathan K. Driggs, Attorney at Law, P.C. All rights reserved.
Jonathan K. Driggs is an employment law attorney with over 18 years of experience, including 3 years with the Utah Labor Commission. www.jkdlawpc.com
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