Employee Handbooks and Why They Are Needed

two co-workers going over documents

laflor/Getty Images

Laws mandate employer actions such as overtime pay, minimum wage, meals and breaks, and jury duty. Other procedures and policies that an employer decides over time such as how to reimburse employee travel for work, paid time off, flexible work schedules and bereavement leave become confusing and difficult to apply and monitor if they have no central location.

Consequently, employee handbooks are in the best interests of both the company and the employees. They provide a set of guidelines for how things will be handled in your company. This allows you to consistently apply, monitor, and measure actions and results.

Help You Consistently Apply Policies

Employee handbooks protect you from such issues as favoritism and discrimination charges. Employees feel that they are treated equally when the procedure is written in the handbook, and the procedure is followed and fairly applied to all employees.

Managers are not forced to decide certain issues, such as time off, eligibility for short-term disability insurance, and whether an employee is adhering to the company dress code on a case by case basis. Instead, they have a clear set of guidelines that the manager and employee share.

Employees know what will happen, and how the charge will be investigated if something untoward occurs such as sexual harassment. Employees and HR staff are on the same page as to how legal mandates such as FMLA are handled in the company.

Employers use the policies in an employee handbook to protect themselves from lawsuits, such as harassment claims, wrongful employment termination claims, and discrimination claims. Employee handbooks generally contain a code of conduct for employees that establishes expectations for appropriate behavior in the workplace.

Progressive discipline and procedures for making a complaint are also in most employee handbooks. In locations where at-will employment exists, the at-will employment statement is in the employee handbook. Since employees sign off on employee handbooks, the employer has a record that the employee read and understood the contents of the handbook, so he or she should know the rules.

Provide the Story of Your Organization

Employee handbooks have positive components as well. Employees are able to learn the story of your company, its history, its culture, and the rights and responsibilities of employees. Benefits, compensation, and other aspects of an employee-friendly workplace are shared.

Positive components of employment at your company are highlighted, too, such as company teams, PTO policies, and flexible work schedule guidelines. In this day and age, handbooks and codes of conduct are your best friends. They are essential components of a well-managed, orderly, fair, employee-friendly workplace. Here's my work-in-progress, my recommended table of contents for an employee handbook.

Overrun with Unnecessary Policies

As an end note, while you review your employee handbooks, I also believe that employers should create as few policies as necessary to maintain an effective, harmonious workplace. Not everything needs a policy, especially when the policy is created to change the behavior of just a few people.

Yet, this is a common and dysfunctional reaction that many HR departments have to aberrant employee behavior when determining whether a policy is needed. Thousands of unnecessary policies are created every year.

If only a couple of employees exhibit problems with attendance, for example, an attendance policy that makes every employee use a time clock is unwarranted. It unnecessarily imposes an inconvenient, daily task on employees and telegraphs a lack of trust on the part of the employer. Deal with the culprits as individuals. Don't subject the entire team to unneeded shackles.


Susan Heathfield makes every effort to offer accurate, common-sense, ethical Human Resources management, employer, and workplace advice both on this website, and linked to from this website, but she is not an attorney, and the content on the site, while authoritative, is not guaranteed for accuracy and legality, and is not to be construed as legal advice.

The site has a world-wide audience and employment laws and regulations vary from state to state and country to country, so the site cannot be definitive on all of them for your workplace. When in doubt, always seek legal counsel or assistance from State, Federal, or International governmental resources, to make certain your legal interpretation and decisions are correct. The information on this site is for guidance, ideas, and assistance only.