The Complete Guide to Employee Handbooks

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If you’re questioning the importance of an employee handbook for your organization, think again.

An employee handbook gives employees a detailed overview of company-specific policies, key procedures, benefits, and guidelines. It helps set clear expectations of what you expect from your employees and defines employee rights while also stating your legal obligations to them.

It also gives new hires a crucial introduction to your business, helping them understand your organization’s mission and core values.

In this Crazy Egg guide, we’ll cover the nitty-gritty of an employee handbook, helping you create your very first document or updating your existing one.

Why Employee Handbooks Are So Important

Employee handbooks—or employee manuals, policy and procedure manuals, whatever you call them—are “living” documents that help improve business practices and keep your business systems up-to-date with the latest legal mandates. 

They are necessary from both the employees’ and employers’ perspectives.

While these handbooks generate consternation from employees, as they mostly concentrate on a list of things not to do, they also give access to a clear list of things that can get employees into trouble with the management, as well as instructions on the specific best practices they’ll need to follow to be successful at your company. 

From the employer’s perspective, a handbook is a well-written document that will help protect them from conflicts and potential litigation. Plus, these handbooks also do an excellent job at keeping employees in check and on track. 

Employee handbooks should be drafted in a way that supports HR compliance to help mitigate risks that could potentially lead to costly legal action in the future, and thereby protect your company’s reputation and bottom line.

Here’s an at-a-glance list of what a well-crafted employee handbook can do for your business:

  • Detail your vision and mission statement, as well as your core values
  • Outline company policies and expectations
  • Reinforce company policies by creating a framework to guide management and leadership
  • Set expectations for employee performance and conduct, and even addresses employee expectations 
  • Minimize risks and conflicts

Moreover, well-drafted employee handbooks can contribute towards a positive company culture to help your business thrive. Having rules and regulations in place will create an environment where all employees feel respected, keeping them engaged and motivated.

Quick Tips to Improve Employee Handbooks

Employee handbooks should contain everything an employee needs to know about working in your organization. It’s why you must draft the document in an easy-to-read and digestible manner, regardless of any necessary jargon, so the employees know exactly what’s in it.

Here are a few tips to help you make your employee handbook more effective:

Keep It Simple and Engaging

Unless you have a legal background, employee handbooks can be, for the lack of a better word, dull. 

Since a handbook deals with your company’s mission and vision, along with several rules and regulations, it’s likely your employees won’t get past the first few lines, especially parts detailing the laws. 

This would defeat the purpose of having an employee handbook in the first place. This is why you should shake things up a bit to boost readability—something that can be done by keeping your handbook simple and engaging. 

Try to present the document in a fun and innovative way, without using legalese or an overly serious tone. Write in straightforward language so your employees can understand even the most complex concepts effortlessly.

Make It Visually Appealing

Yes, visual appeal matters even for internal documents.

Your employee handbook doesn’t need to be just chunks of text. You can add visuals to illustrate complex concepts, as well as use photos of your staff to feel more familiar.

In addition to images, formatting is equally important for increasing visual appeal.

You should use plenty of headings, sub-headings, bullet points, and paragraph breaks to make the content more digestible. Employees will find it easier to read through different sections, plus if they want to look for a specific section in the handbook later, they’ll be able to find it in a jiffy.

We highly recommend incorporating humor. Don’t force it, though. Only include it if it fits naturally.

Keep It Short

Do you enjoy reading pages and pages of a never-ending document? 

Exactly. Your employees feel the same about the handbook.

In essence, the employee handbook I meant to convey crucial information to employees. So it’s important for an employee to actually read it! But like most things, the longer the handbook, the lesser the chances of an employee actually making it through it.

The policies you add to the handbook should just be snapshots or summaries of the longer policies. Keep it brief and to the point. Additionally, don’t include policies that don’t apply. What’s the point, right? 

You see, employee handbooks aren’t a one-size-fits-all document. You have to figure out whether specific laws apply to your business. If it doesn’t, the law shouldn’t be included in your handbook. 

For instance, the Family and Medical Leave Act (FMLA) mentions if an employee only has one location and less than 50 employees, the employer isn’t covered under the FMLA (barring some special circumstances). Therefore, there’s no need to include an FMLA policy in your employee handbook if you only have 32 employees.

Leverage It As a Communication Tool

A handbook can be a great means to communicate with your employees.

To do this, however, you have to explain what you expect from your employees instead of filling it with legal terms and your company’s mission and vision statements. You should also cover what employees can expect from you. It should feel like an effortless conversation between the employee and the employer. 

The best way to ensure this is to avoid an authoritarian tone. Treat your employees as adults who are partners in your company’s success. You should also reassure them that the management is always there to help them when needed.

You should also encourage employees to approach you directly if they have any questions or want clarifications even if they have the handbook. The idea is to make them feel welcome—not alienated.

Make Periodic Updates

As mentioned before, employee handbooks are living documents. So you can change them as needed to stay on top of trends and times.

We recommend talking to your current employees, HR staff, peers, and lawyers who will be here to make regular updates. A good rule of thumb is to review the document at least once a year.

Long-Term Strategies for Writing Employee Handbooks

In this section, we’ll discuss long-term strategies to help you write a good employee handbook for your organization.

Develop a Clear Vision for Your Handbook

Before you start working on your handbook, you need to have a clear vision of what the document should state, how it’ll say it, and what topics it will include.

For this, you’ll need answers to some important questions that can help define and find company policy and culture. Here’s a list of insightful questions to get you started:

  • How many hours should an employee work for being considered full-time? Do you want to add part-time employees to your workforce?
  • What will your organization’s pay cycle look like? How often will your employees get paid?
  • Do you want to offer direct deposit or check payment methods of payment?
  • What benefits will your employees get?
  • Do you want your employees to sign an NDA? If yes, why is it necessary? 
  • What’s the official dress code for your company?
  • Do you want to implement a social media policy?
  • What will your paid time off policy look like?
  • What are the most important dos and don’ts for employees to be aware of?

Although answering questions like these will take time, it’ll help you set yourself (and your company) up for success. 

Outline a Rough Handbook Draft

Your employee handbook should cover your company’s mission statement, contractual disclaimer, equal employment opportunity statement, and at-will employment statement (when needed). Mentioning the purpose of the employee handbook and supplying background information on the company is also important.

Other than the above, you have the right to decide which additional topics to include. Generally, it is best to consider legal mandates for federal and state laws that affect employees, such as COBRA, FMLA, ADA, and EEOC anti-discrimination laws.

Not communicating legal mandates may result in confusion and non-compliance with the laws—something you want to avoid at all costs.

Clearly Detail Work Hours, Compensation, and Benefits

Since an employee handbook is made for employees, you should make a point to include everything they need to know to be productive in your company. This includes detailing compensation and benefits, work hours, and leave allowance.

You should also be as clear as possible. For instance, if your employees are paid by the hour, make sure you mention how you’ll clock their hours. We highly recommend using reliable onboarding software that offers time-tracking facilities, among a host of other features.

ADP Workforce Now’s time-tracking software is a user-friendly tool to schedule and manage time and attendance—features that are sure to help your organization save money and improve productivity.

The more specific you get about these things in your handbook, the better it’ll be for your employees.

Highlight Your Company Culture and Mention How Employees Can Maintain It

Company culture refers to a “set of shared values, goals, attitudes, and practices that characterize an organization,” as defined by Builtin.

And yes, it’s just as important as it sounds. In fact, not fitting within the company culture is one of the most common grounds for firing employees.

It’s why you shouldn’t make your employees guess what your company culture is. Instead, you should be explicitly clear when mentioning your company‘s core values and the shared ethos that drives all workplace actions.

What’s more, explaining company culture in the handbook also facilitates the onboarding process. New hires will know what to expect when they join your company and how they can fit within it. Even the existing employees will be reminded about the core values when reading explicit statements concerning your company culture.

You should also include pointers to help employees maintain that company culture.

Iron Out All Legal Concerns 

Once you complete your employee handbook, you should get a lawyer to review the language and clarify any legal concerns. Doing this will save your company from lawsuits and hence, save you some serious money.

A lawyer will also ensure the handbook includes all legally required policies, such as the local, state, and federal policies.

Complying with the National Labor Relation Act (NLRA) provisions, which were designed to protect employees, is particularly important. Your employee handbook should adhere to all its compilation of illegal and legal rules. 

Ask for Employee Feedback

Once you drafted the employee handbook, pass it along to a few of your trusted employees for feedback. 

This makes sense since your employees are best placed to tell you whether your handbook is easy to understand and explains complex concepts in layman’s terms. 

Ask employees to give you feedback on the handbook content. You should also encourage them to point out common employee concerns that may have been left out. Getting feedback is the best way to identify areas that need improvement to make your handbook even more effective.

Based on the feedback you get from employees, you can determine if your handbook is finally ready to roll out.

Next Steps

Once you draft and publish your employee handbook, make sure everyone in your organization gets their copies. 

Ask them to go through the whole document carefully and encourage them to come to you—or the managers—if they have any doubts or want clarifications. Make them feel the management is always there to help them.

Want to manage your employees effectively to accelerate your productivity levels? Here are a few Crazy Egg guides that can help:

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