What Elements to Include in Your HR Employee Handbook

If corporations are engines, than their workers are the fuel that makes them run. And just as better grades of fuel extend the life and increase the performance of that engine, so too do better people improve the quality, efficiency and experience of the workplace. The task of the Human Resources department is to recruit desirable candidates, train them to be productive employees, and manage their conduct within the organization’s existing framework. Important issues that employees expect Human Resources to address range from compensation and benefit plans to official work site rules and policies.

For extremely small businesses (those with 20 employees are less), Human Resources is often an unnecessary luxury. However, entrepreneurs who are intent on expanding the size and scope of their small businesses may be seriously considering the creation of an HR department to address ever-growing staffing needs. In that case, it will be the task of the business owner to work with their new HR Director in order to address the policies of the workplace and then organize them into a coherent handbook.

This handbook will be provided to each employee upon their hiring. As such, certain attributes are deemed an integral part of every handbook, regardless of the nature of the business.

Harassment Policy

This section deals with the policies of the company in regards to unwanted advances or touching, inappropriate language, obscene jokes, written or oral abuse, sexual misconduct and the display of sexually suggestive or offensive objects, pictures or posters. Management should lay out how accusers and offenders will be dealt with, including potential action up to and including termination. In most states, the harassment policy must be tailored to comply with existing labor laws.

Drug, Alcohol and Violence Policy

Similar to the harassment policy, this will detail the employer’s efforts to create a safe work site in compliance with state and federal laws and free from illegal activity. Consequences for violating the policy, up to and including termination and criminal prosecution, should be thoroughly explained.

Attendance and Employment Basis

A good handbook will address attendance requirements and penalties for consistent tardiness or absenteeism. It will also clearly articulate whether employment is of a contractual nature (and what is required to trigger an exit), or whether it’s considered “at-will,” in which case the employer or employee can terminate the relationship at any time with or without cause.

Work Hours, Scheduling and Time Cards

The employer is tasked with setting clear hours for the employees, particularly if certain work schedules are irregular. The handbook should lay this system out along with how hours are to be tracked, be it a punch card, electronic time sheet or some other method.

Pay Periods, Paydays and Overtime

Compensation matters are usually of the utmost importance to employees at all levels, and as such, must be clear and concise. The pay period addresses how often employees will be paid and what range of dates the paycheck will cover. Is it every week, every two weeks, the 1stand 15th of the month, or something else? The payday is what day or date the employee can actually expect to receive the check. Also, how overtime hours will be scheduled and approved should be addressed.

Holidays, Sick Days and Vacation Pay

The company should list any holidays it recognizes and compensates employees for. The six standard government holidays recognized by most firms include New Year’s Day, Memorial Day, Fourth of July, Labor Day, Thanksgiving and Christmas Day; however, employers are free to choose whichever paid holidays they like. In addition, the employer should articulate how many paid sick days, personal days and vacation days each employee starts with, how many they can attain in time, and over what amount of time these things accrue.

Leaves of Absence and Re-Employment

This section details how longer employment leaves will be handled, be it for military duty, bereavement, maternity, jury duty or personal reasons. It will also address how former employees who are re-hired within a certain amount of time are treated, including the uninterrupted continuation of benefits or the ability to skip new employee orientations.

Dress Code

Management must detail what apparel is appropriate for the workplace and what is not. This may not only change from company to company, but also from employee to employee within the same company. For instance, IT engineers, sales associates and warehouse workers may all require different clothing to properly perform their job duties.

Confidential and Proprietary Information

Most companies want to be absolutely clear that it is they, not the employee, who owns all supplies, client lists, contracts, sales reports, financial and marketing data, systems, forms, software, hardware and other corporate materials either provided by the company or generated while the employee is at the company. Such information is usually deemed to be of a confidential nature as well so that employees keep it out of the hands of competitors and the like.

Other Information

Various other sections of the handbook might deal with how personnel files and records are maintained; how performance evaluations are administered; what constitutes conflicts of interest; policies on gift-giving and receiving, solicitation and distribution on company property; how business expenses are handled; personal inspections; electronic networking and resource policies; stock shares, IRAs, 401(k) plans and insurance benefits; and the chain of command when reporting any workplace issues.

It is also imperative that companies place a signature page at the end of the handbook, which the employee must sign and date acknowledging that they received a copy of the book, read it and fully understand its contents. The page should then be removed from the book and maintained in the employee’s personnel records.