In my previous post about how to Onboard employees and have them loving you from day one, I pointed out all the ways to welcome them with style. Now, imagine how many questions a new employee would have their first week if they did not have an employee handbook. This quick reference would answer questions like: when will I be paid and how? Which holidays are company holidays, and are they paid? Who has access to my personnel file? How do I request time off?
If an employee is coming to you to get all of these questions answered, that is a huge loss of your valuable time. Take the time now, create that employee handbook that answers all of those questions. As your company grows, you are prepared to handle those new employees.
Employee handbooks are a communication tool for both the employee and the company.
Let me show you how to write an effective employee handbook that you will be proud to call your own.
In this article, I am going to share:
- Step1: Realizing you need an employee handbook
- Step 2: Convey your company culture
- Step 3: Set expectations through clear communications
- Step 4: Policies that are mandatory- do not skip these
- Step 5: Standard policies you should be adding
- Step 6: When to be cautions when writing your employee handbook
The first step is to determine if you need an employee handbook, which is easily determined by one question: do you have one employee or more? If you answered yes to this question, then you need an employee handbook. Let me walk you through the steps you need to take to write a great one.
Step 1: Realizing You Need an Employee Handbook
I have told you that you need a handbook if you have one employee or more, but why do you really need one? Although there is no law stating that you have to have an employee handbook, this tool is a good idea for legal protections and to effectively communicate with your employees on both what you expect from them and what you will provide to them.
If you have never viewed an example of what an employee handbook looks like, the National Federation of Independent Business has a great example of a typical employee handbook for you to view.
One of the main reasons an employee handbook is important is that it allows for easy conveyance of your company culture.
Step 2: Convey Your Company Culture
Now that you know you need an employee handbook, let’s discuss what needs to be included in that handbook. First and foremost, your company culture needs to be included in your handbook.
Company culture is important because it is the thing that sets you apart from everyone else. You may have a business where there are thirty other companies doing exactly what you do. Your company is set apart by your values and vision. People want to do business with a company because of what they believe in and what their values are, rather than for just the products that are offered.
The term employee handbook in itself leads most to a yawn. It can be the most boring document on the face of the planet, but it doesn’t have to be. Employee handbooks should be more than just policies and procedures. This text should breathe your company culture. Wikipedia defines organizational culture as having to do with the “behavior of humans within an organization and the meaning that people attach to those behaviors.” To me, this definition is vague. The best explanation I have found was written by William Craig in the Forbes article, “What is Company Culture, and How Do We Change It?”
In the article, Craig states, “company culture is something that is pre-existing in your company’s genetic code; it’s not something that employees bring with them. In fact, a company with just one employee – a company with no employees, if we’re being honest – still has a culture. That sole proprietor? They’re the one with “vision, values, and assumptions.” They don’t wait around for employees to provide such things; instead, they seek out those individuals who they feel would be a good match with their existing vision for the company.”
Your employee handbook should convey the vision, values, and assumptions for your company. It should tell the story of how your company came to exist. Employee handbooks are important because, even if you have one employee, you want to provide that vision.
Take Fearless Social as an example. Our mission is providing commonsense education, empowerment, and elegant tools which give HOPE to entrepreneurs that are just starting, looking to get the next level, and/or wildly successful.
I truly believe that each one of our team members portrays this vision completely. You see it in our leaders, Ben Adkins and Monica Birdsong. You see it in our online communications, via email, and with our help desk. We live, breath and die by our vision. It is who we are.
People do not purchase our educational products just because they are great products. They purchase them because we have an amazing team who delivers on the vision our leaders have placed in front of us. Our leaders blaze the trail for us to do some pretty incredible things. It is also why we all love working for the company.
Company culture is what makes you stand out in the crowd of others. And that is exactly what you want to embed in your employees. You want your employees to look, sound, act, and talk like you would about your company. That is company culture. Your company culture defines the way in which your organization interacts with one another, and how the team interacts with the outside world. Those interactions should be outlined in your employee handbook.
If you are interested in learning more about company culture, I recommend a book on company culture called Brewing a Creative Culture, written by the staff of Dillanos Coffee Brewers. It’s a great short read that has twelve formulas to blend outrageous fun with high accountability for the perfect company culture. In the book are everyday examples of how the employees put those formulas to work for the company.
Now that you know that company culture is the personality of your company, let’s discuss how the handbook can help you set expectations with your employees.
Step 3: Set Expectations through Clear Communication
Company Culture is extremely important, but just as important is effectively communicating with your employees. By laying out clear expectations, employees understand what is expected of them and what they can expect from the company. Fearless Social sets company expectations on the very first page of our employee handbook. We outline our vision and our core values. This vision and values is not just for the company but for our employees as well.
The handbook should take expectations a step further than just a vision statement and core values though. People work harder, smarter, and better when they have the clear communication about what is expected of them and where the company’s future is headed. It allows employees to see what success in their job will look like if you clearly communicate all expectations. Lay it all out on the table. The schedule, the work environment, how they will be held accountable, how they will be reviewed. A successful handbook is written in a clear, understandable manner, and accurately reflects the culture of the company.
Remember, the employee handbook is not the only place where you should be communicating expectations with employees. You should be clearly outlying expectations during the hiring process, in the employee reviews, and during meetings as necessary. Communicate and keep on communicating.
Now that you know some reasons why employee handbooks are good for more than just stating rules, let’s take a look at the policies that are mandatory.
Step 4: Policies that Are Mandatory—Do Not Skip These
Now that you know how to communicate with your employees, let’s dig into what you need to be communicating to them. There are certain policies that every business must abide by. These policies should be located inside the handbook—if not somewhere in your company where the employee has access to it. This means it is very beneficial to you to learn about your local, state, and federal requirements.
To become familiar with federal regulations, check with the U.S. Department of Labor . The website gives information about federal laws that impact workplace issues. Local and state regulations will vary state to state. Many state departments have a listing on their respective websites as well. The Society for Human Resource Management also has great resources on required policies.
Each state will have different rules and regulations. We would highly recommend finding a lawyer in your state that thoroughly knows the laws to guide you when you have questions, and to review your handbook before distributing it to employees.
When handbooks are well written, they can protect the business from several legal headaches. Poorly written or incomplete handbooks have gotten businesses into trouble for a plethora of issues, from discriminatory hiring practices to wrongful termination.
Here are some policies that you need to include in your employee handbook.
The Family and Medical Leave Act (FMLA)
This policy requires that employers of a certain size must provide employees with up to twelve weeks unpaid leave during any twelve-month period for the birth or care of a child, to care for an immediate family member with a serious health condition, or if the employee has a serious health condition.
Equal employment and non-discrimination policies
The U.S. Department of Labor requires businesses to post information stating that the business follows non-discrimination and equal opportunity laws in hiring and promotion.
American’s with Disabilities Act (ADA)
This policy prohibits discrimination against people with disabilities in employment, transportation, public accommodation, communications, and governmental activities.
Workplace harassment and discrimination and reporting procedures
Harassment is unwelcome conduct that is based on race, color, religion, sex, national origin, age, disability, or genetic information. It is important to not only have this policy in your handbook, but to also state what an employee needs to do if they encounter harassment.
Now that you know the mandatory policies, let’s go over the ones that are standard in employee handbooks.
Step 5: Standard Policies You should Be Adding
Now that you know the Policies that you must include, let’s review the policies that you want to add to your employee handbook. Below are some of the policies that we found important to share with our employees.
It is a good idea to include a clause that states that the employee handbook does not constitute as a contract for employment. Ours looks like this:
The contents of this handbook are presented as a matter of information only. While the company wholeheartedly in the plans, policies and procedures described here, they do not constitute a guarantee of employment or promise of any benefits. The company reserves the right to modify, revoke, suspend, terminate, or change any or all such plans, policies, or procedures, in whole or in part, at any time, with or without notice. The language used in this handbook is not intended to create, nor is it to be construed to constitute, a contract between you and the company.
We also take it a step further and include that our company is an at-will employer. This means that employment is entered into voluntarily, and that both the company and the employee are free to resign or terminate the position.
Complying with laws, rules, and regulations
This clause states that in addition to the employee handbook, that is it imperative that all employees comply with local, state and federal laws. We also state that if an employee is uncertain about applicable laws who they need to contact for guidance.
Termination policies don’t seem important until you need them. This type of policy states how terminations will take place. In our policy, we state that either party may terminate the employment at any time, for any reason.
Paid time off/vacation policy
This policy communicates with employees as to how they earn time off, how to request days, and what happens if they do not use all of the available time within the year. It also details what happens if that employee were to leave the company.
Social media policy
Although this policy is not for every company, in today’s age it could be important. Our company, which bases most of our business on social media, has a social media policy. In this policy, we outline what is expected, and not required, of our employees.
This is where state law will come into play. Each state has a different regulation concerning what an employee can and cannot have access to. California, for example, allows for employees and former employees the right to inspect, at reasonable intervals, any personnel records relating to performance or to a grievance proceeding. Employers must comply with only one request per year from former employees. In this policy, it should include what is included in the employee’s file, who has access to it and how to request information.
Pay and promotions
This should state how and when you will pay your employees. Do they only have the option of direct deposit, or will you write them an actual check? When are the paydays? How will they receive their paystubs? How are pay increases handled? The employee should not have to ask anyone in the company any of these questions. All of these should be detailed in your employee handbook.
Now, remember benefits is more than just insurance and a 401(k) plan. If you have offer those benefits, they will need to be laid out here. When are the employees eligible for the benefits? How do they get signed up? Who do they contact if they should have questions?
Benefits could include equipment, like cell phones, that you give employees to use. We do that as well as hosting Fitbit competitions between our employees. This encourages those of us who spend almost all day on our rears to get up and get moving. To encourage that behavior we are rewarded with gift cards of our choice! For every 10,000 steps that we take during the week our name goes into the hat for random draw on Monday for, a $50.00 gift card of the employee’s choice. Then at the end of the month we give away $250.00 to the employee who has the most steps out of everyone.
For guidance on what you are required by law to provide to your employees, check with your lawyer, or check out our Dream Team Training.
Step 6: When to be Cautious When Writing Your Handbook
We have gone through all several policies that are highly important to add to your employee handbook. It’s time now to discuss some things to be cautious about when writing that handbook. And how to cover your bases when you are unsure.
The National Assessment of Adult Literacy conducted a survey which states that the average adult in the U.S. reads between the 8th and 9th-grade reading level. Which means, when writing your employee handbook you need to keep in mind that reading level.
If you want to know what reading level you are writing in use the Hemingway Editor. On this website all you have to do is copy and paste your text into the main area and it will automatically give you a Readability scale.
If you say in your employee handbook that leave can only happen with two weeks prior notice to leave request, but you frequently allow certain employees to take off at the last minute, it may cause you a world of legal trouble. If you are going to put something in your employee handbook, be sure it is something that you want to practice on a daily basis.
Make it fit your company’s personality
Employee handbooks do not have to be the dry, boring document that they typically tend to be. You can infuse your companies personality into it. Take Disney’s employee handbook from 1943 shown in the Brain Pickings article, The Ropes at Disney: 1943 Walt Disney Employee Handbook. This is a perfect example of breathing life and personality into a handbook that is typically viewed as boring.
Be cautious of wording
If your policy states that employees will be fired for cause only, or spell out how and when terminations will be handled, you might be creating an implied employment contract. This is why it is extremely important for you to have an employment lawyer review your handbook before handing it out to your employees.
Failing to update it frequently
Businesses frequently change, as do laws about employment. Fearless Social looks nothing like it did four years ago. We review and update our handbook, if needed, on a yearly basis. We may have decided to add another benefit to our policy or to do away with another. Reviewing it yearly allows us to remind ourselves of the standards we have set for our employees and ourselves.
Play by your own rules
There are no set rules on what an employee handbook must look like. If you are breathing your company culture into it, it will not look like anyone else’s handbook. Make it scream your personality. Below are some examples of companies who have taken an employee handbook and turned it into something magical.
4 Examples of Amazing Employee Handbooks
Now you know why, what, and how to write an employee handbook. I have said it time and time again, but it doesn’t have to be a boring document. Make your employee handbook as quirky as you are as a company. Below are some examples of companies who have knocked handbooks out of the ball park.
- The number one employee handbook that is talked about time and time again is the Valve Employee Handbook. This handbook is so great they use it as a recruiting tool to attract and keep a talented pool of employees. When reading this employee handbook you clearly get their company culture. If you can create an employee handbook like this, consider yourself a success. View the Valve Employee Handbook Here:
- Some companies choose to separate their employee handbook by creating one culture book, and then another for policies and procedures. A great example of this is the Disqus Culture Book. View the Disque Culture Book Here:
- When you think of top customer support, I bet one company in particular comes to mind. Did you think Zappos? Zappos has such an amazing culture, and focuses on hiring the right person from day one. They go so far as to offer $3,000 to leave after the first week on the job if you do not feel you are the right fit. Zappos took their company culture and created an employee handbook that looks like a comic book. If that doesn’t scream a fun handbook, I don’t know what will. View a video on the Zappos Handbook here:
- Sometimes, the less you say the more powerful it is. Take the Nordstrom handbook, for example. This is often called the world’s shortest employee handbook. This handbook is a card that reads, “Use good judgment in all situations.” How powerful of a statement to give to your employees! Now, obviously they need to have more, and they do in an online formal document.
Take everything that we have discussed and put it to work for you. Keep in mind that laws continually change, and some laws will affect your employee handbook differently than others. We always suggest consulting with an attorney in your state for review of your handbook before you hand it out to your employees. Although you will want an attorney to look at the handbook, don’t be afraid to dig in and write the handbook yourself. An attorney will not be able to convey your companies’ personality and culture quite like you would. And have your team help.
The items discussed here are not the only things that you need in an employee handbook, but these will lay an excellent foundation. Take the steps I have given you and make your employee handbook something your employees will be happy to have.
If you want more on what to include in an employee handbook, as well as what to keep in that employee file, check out our Dream Team Training.
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