8 SMB Employee Handbook Mistakes

by John Beagle

Employee handbooks are your first line of defense against the myriad of potential employment-related lawsuits your company faces. A good one will stand up in court and protect your company. But a poorly drafted one – containing lawsuit-provoking buzzwords, confusing language or other unnecessary verbiage that limits your flexibility – is a dream come true for a plaintiff's lawyer.

Learning common mistakes companies make in drafting handbooks – and how to correct them -- will help you avoid legal pitfalls.

For example, an airtight employee handbook will allow you to manage employee expectations, reducing confusion about applicable policies. It will also provide a defense against lawsuits provoked by employees who claim they didn't know about reporting procedures, or that the company had inadequate procedures.

Here are a few common mistakes employers make in regards to employee handbooks:

1. Not reading a template handbook first. It is unnecessary to try and re-create the wheel. There are plenty of employee handbooks available to read as well as templates that can be found to help you construct yours. Use other resources before attempting to write such a handbook.
2. Failing to update the employee handbook. Reasons to update your employee handbook include new laws, new technology, and various changes in how you conduct business. Businesses are sometimes better off having no handbook than having one that is years old and outdated. Therefore, once you have an employee handbook, it is a good idea to update it at least once a year.
3. No disclaimer. A disclaimer prevents an employer from being boxed into a corner. Without a disclaimer, the handbook can be construed as a contract. There needs to be some room for the employer to use discretion and work within the general guidelines of the handbook. Therefore, do not make the mistake of neglecting the disclaimer.
4. Complicated language. If the handbook is too vague or technical and not clearly understood by employees, then it may not serve the intended purpose. Make sure everything is easy to understand and reader-friendly.
5. Not introducing the handbook to new hires. The sudden introduction of an employee handbook can imply that the organization is not happy with the way in which employees are conducting themselves. This is often not the case. It is, therefore, preferable to make it clear that the handbook is just a means of clarifying procedures and policies. Also, you should be prepared to answer questions regarding the handbook.
6. Not making sure all employees have a handbook. You should have everyone sign off that they have received the handbook.
7. Not having the handbook reviewed by a lawyer. There are many ways to state your policies, some of which may be vague or potentially misconstrued. Have an attorney who is well-versed in employment law review your handbook before running off copies.
8. Not taking into account federal and state laws. You need to keep in mind that laws such as the Family Medical Leave Act, among others, cannot be violated or misstated in your handbook. The same holds true for local statutes too.