Building a Legally Sound Employee Handbook
When you’re building and running your business, you’re likely juggling multiple priorities—fundraising, product development, customer acquisition, and team building. One aspect that can sometimes be overlooked is the employee handbook.
Although this may seem like a less-than-exciting formality, a well-crafted employee handbook is a critical tool for protecting your business, communicating expectations, and fostering a healthy workplace culture. A thorough employee handbook can also help you avoid legal headaches and ensure compliance with federal, state, and local laws. Here are some key considerations:
Why your business needs an employee handbook
An employee handbook can help with the following:
Establish consistent policies to avoid confusion and unfair treatment.
Mitigate legal risks by clearly documenting your compliance with employment laws.
Set expectations around conduct, benefits, and company culture.
Support your onboarding process by providing a go-to resource for new hires.
In short, it protects both you and your employees.
A handbook sets clear expectations and protects both your business and your team.
Policies to Include
If your business has at-will employees (as opposed to employees with fixed terms of employment under a contract), include a clear statement for those employees that the employment is at-will, meaning either the employee or employer can terminate the relationship at any time, with or without cause (unless otherwise specified by law or contract).
Anti-discrimination and harassment prevention policies: Outline your company’s commitment to fostering a workplace free from discrimination and harassment, and include relevant details to address any issues employees have in these areas (such as contract information for supervisors or HR managers to contact in the event of a problem). This section should include relevant provisions under federal laws prohibiting discrimination on the basis of race, age, religion, and disability status, as well as any relevant state and local anti-discrimination laws.
Leave policies: include information on sick leave, paid time off, family and medical leave, and any state or locally mandated leaves (such as New York’s Paid Family Leave regulations).
Code of conduct and disciplinary procedures: define expectations for professional behavior, use of company equipment, and remote work guidelines if applicable. Detail how performance issues or policy violations will be addressed. A fair and transparent process reduces the risk of wrongful termination claims.
Technology and confidentiality policies: Explain acceptable use of company technology, data security expectations, and protection of confidential information and intellectual property.
Acknowledgement form: Include a section for employees to sign, confirming they’ve received, read, and understood the handbook.
These core policies form the foundation of a legally sound employee handbook.
Review and update regularly
Employment laws change, and as your business grows, your handbook may need to change too. Aim to review your handbook annually or whenever there is a change in employment laws that apply to your business, a shift in company policy (such as changes to remote work guidelines or employee benefits), or a significant growth in number of employees or geographic scope of new hires.
Employment laws can vary by state and even city, and it is important to ensure that your handbook reflects the jurisdictions where you operate (including locations of remote employees), your company size and structure, and any industry-specific rules and regulations.
Final thoughts
Having a well-crafted handbook is an important first step, and the handbook should also be a part of your onboarding and training process for each employee. A good employee handbook can help you scale your team with confidence and make sure your business is up-to-date on labor & employment compliance matters. If you’re not sure where to begin, feel free to reach out to Fryman PC to book a call to discuss drafting or updating your handbook or employee training procedures.