This session was presented on January 19, 2023
An employee handbook is a powerful tool to communicate your organization’s policies and culture, and can help set the tone for the entire employment relationship. It can also form the first line of defense in an employment lawsuit or investigation. If your company doesn’t have a handbook, or it hasn’t been reviewed in the last year, this webinar takes a deep dive into the most important policies for your handbook and what you’ll want to consider when drafting them.
Webinar Transcript:
Megan (00:00:03):
Hello everyone. Thanks so much for joining me today. We’re going to give it about 30 seconds to let other people log on. We’re just at the top of the hour, so if you can bear with me, I’ll start talking in about 30 seconds from now.
(00:00:45):
All right, welcome again everyone who’s joining me today. I’m excited to welcome you to our training Taking Care of Business: Employee Handbooks. Before we begin, I’ll just briefly introduce myself. My name is Megan and before joining the team I practiced employment litigation, focusing on discrimination and lead laws. I’ve worked in a variety of different industries and have drafted many, many handbook policies. I also a little bit of a cold today, so if you hear me pause, I’m probably taking a sip of tea. Just want to let you know you haven’t lost me. I just hope my voice makes it for the hour that we’ll be spending together.
(00:01:31):
With that, here are some quick housekeeping items. We’ll be emailing you a recording of this presentation and a PDF of the slides in about 24 hours. I’ll be holding two polls later on and I hope you’ll participate in both of them. And then there is a Q&A box for questions. You’re welcome to chat in your questions along the way, and I will get to as many as I can during our brief Q&A session at the end.
(00:02:03):
Before diving in, let’s take a look at where we’re going. So first up, we’re going to talk about the purpose of an employee handbook, why do you want to spend time on doing one? Then we’ll go into what we want to see in a good employee handbook, as well as some things to avoid. We’ll talk briefly about administering the handbook, basically what to do with it once you’ve got one. And finally, I’ll go over some tips about reviewing and updating your handbook. And it’s not here, but as I mentioned, there will be a brief Q&A session at the end. All right, with that, let’s jump in.
(00:02:41):
So to start, why do we even have employee handbooks? At its core, the function of an employee handbook is to communicate expectations, mostly for employees but also what employees can expect from the company. In terms of what we want from employees, you want to set out their basic responsibilities, so things such as reporting all time worked, your dress code, calling out when they’re sick, those are some of the basics. Also, what benefits can they expect from the company? Both in terms of mandatory benefits that come from state or federal law, but also optional benefits, if your company’s chosen to provide any. My personal preference is to have some kind of company stamp on them, and you can do that by setting out your company’s history, your vision, mission, values, whatever it is that you want new employees to get excited about or drive them to put in their best effort.
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Handbooks also provide a vital reference document for managers to implement and enforce your policies, and that’s just critical for keeping your organization running smoothly. Handbooks also tell employees who to contact, for example, if they need more information about a particular policy, or if they have a concern or complaint to raise. A solid handbook can be your best line of defense when facing an investigation or litigation resulting from an employee complaint, and really by simply helping you comply with the employment laws you’re subject to.
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So on that point about helping to defend against claims, probably the best example of the importance of having a policy is a harassment complaint of the hostile work environment variety. So there’s this defense called the Faragher-Ellerth defense, and the name doesn’t really matter, but what’s important to know for employers is that one of the necessary components of the defense is that you exercised reasonable care to prevent and promptly correct harassing behavior. The easiest way to show this is to have a policy that, number one prohibits harassment, and number two provides a procedure to complain about harassment if it does happen.
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So let me kind of flush this out with an example. Let’s say you’ve got your policy and it does those two things. It prohibits harassment and it provides the steps for employees to report harassment. And unbeknownst to you, one of your employees starts harassing a coworker. Let’s say the coworker puts up with it for a while, but then finally has enough and they go file a complaint against the company in court claiming hostile work environment. This is the first you’ve heard about it and you immediately question the employee who’s the alleged harasser, and they fess up. Everything in the complaint is true. Heart sinks, your mind races, this looks really bad.
(00:06:03):
But wait, don’t despair. You had your policy that said how employees can report complaints to the company, and the employee who was getting harassed didn’t report it. You, or more likely your lawyer, can raise this defense and show exhibit A as your policy. Exhibit B, the employee’s acknowledgement page signing that they received the policy. And you can ask the court to kick out the whole lawsuit. You are saved. So I should reiterate that one piece of this defense is the policy, but another is that if you do get complaints, you have to act on them to stop any harassment that is occurring. The details of a harassment investigation and related discipline are beyond the scope of this webinar. The takeaway here is just that having a policy is a really easy box to check off and it can be instrumental in getting you out of some otherwise really hot water.
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All right, now let’s take a moment to discuss what your handbook doesn’t, or maybe you shouldn’t do. First on the list, we’re going to say that an employee handbook shouldn’t function as an operations manual. I encourage you to have an operations manual if it makes sense for your business to have more specifics about how things are done, how employees actually do the work of their job or the nitty gritty of company procedures. But I think that they’re better having a separate document from the employee handbook. At the most practical level, this just helps employees narrow down where they should be looking for the piece of information they need, instead of having to sift through what can be pretty long document already.
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And then the next two items are really about preserving the at will employment relationship, which we’ll discuss in a little bit. Basically don’t promise continued employment and contracts belong outside the handbook.
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All right, so who is your audience? Definitely employees. Every employee, whether full-time, part-time, temporary, regular, they should all get a copy of the handbook. In contrast, you don’t want to be giving your handbook to independent contractors. Independent contractors can only be properly classified that way if the hiring entity team has very little control over them, meaning that you as the employer aren’t dictating how they do their job, when they do their job or where they do their job. And the handbook on the other hand is basically 40, 50, however many pages of telling employees exactly that. So if you’re expecting independent contractors to read and follow the policies in your handbook, then they’re effectively employees and should be classified that way so that you’re not on the hook for things like payroll taxes and unpaid overtime, and really anything that employees are entitled to as employees.
(00:09:15):
We also want the policies in the handbook to be very clear about which employees they apply to. So which employees are eligible for healthcare, paid time off, paid holidays, it’s full-time, temporary, that sort of thing. By putting it in your policy, you can spare some hurt feelings or at least some awkward conversations of an employee asking for a benefit that you’ve decided isn’t available to that group or classification.
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Finally, try to make your handbook easy to read. You really don’t want employees wasting time trying to decipher what a wordy, long-winded or complicated policy means. To make your handbook easy to digest, you want to avoid legalese, big words and really long sentences. When I’m writing a policy, I try not to have a sentence that’s longer than three lines, just because shorter sentences that are easier for our brains to process. Really, whatever you can do to simplify the policies without sacrificing clarity is going to go a long way to having the handbook serve its purpose.
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Okay, this is a good time to pause and take a poll before we dive into the specific about handbook contents. So I’m going to load it up on the screen here. Which policy do you deal with most often of these options? So vacation, PTO, leaves of absence, conduct guidelines, drugs and alcohol. People are submitting their answers. Thank you very much. I’ll go ahead and leave the poll open for another 10 seconds. All right, still got some people answering the poll and we’ll go ahead and end it now. All right, so it looks like the majority deal with vacation and PTO most often. That would’ve been my guess, so that’s interesting to know that I was spot on there. Also, a fair bit of conduct guidelines, leaves of absence. And drugs and alcohol, not as many, so pretty good spread there. Thanks so much for participating.
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Let’s see, close the poll, move on. All right, now we’ll get into what should be in the handbook itself. First, a quick disclaimer. Our standard handbook is pretty long and has a lot of policies, so I won’t cover every single policy I recommend having in a handbook, but I will be hitting the highlights.
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So first up, I mentioned kind of having your company stamp, and the welcome message is a good place to do that. You can give some background on your organization and really set the tone for your entire handbook. This can be where you include your vision, mission, values, like I mentioned earlier. Really, you just want to make a positive first impression on new hires and hopefully give them a sense of pride in working for your organization, as well as a sense of belonging.
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And then as far as policies, I recommend starting out with the at-will employment relationship policy, exempt or equal employment, exempt classification, and then full-time versus part-time, and I’ve broken each of these out onto their own slides.
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All right, so first up, the at-will employment relationship. We get asked about this a lot. At its core, at-will is describing an employment relationship that is not guaranteed, fixed or permanent. The employee hasn’t agreed to stay for a certain amount of time and the employer hasn’t promised that employment will be ongoing. The standard in the United States is that employment is at-will with a few exceptions. For example, high level executive positions, sometimes doctors, and also Montana limits at-will to the probationary period. After that in Montana, the employer needs good cause to discharge an employee. When there’s not at-will, often in the case with employment contracts, then it’s possible for the… or more than possible, likely for the employer to be on the hook for breach of contract and having to pay damages for breaking that contract.
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So suffice to say, we want to avoid that. And one way we can do that is to put in the handbook in writing, very clear terms, that employment is at-will, which means that employment can end by either the employer or the employee, at any time, without notice and without cause. Of course, at-will doesn’t exempt employers from complying with the law. So in other words, you can’t fire an employee for an illegal, reason such as taking a protected leave or based on a protected characteristic.
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So big picture here, at-will is a must-have for probably 99% of handbooks, but we also don’t want to hang our hat on at-will because you want to be able to show that the reason for terming an employee isn’t actually an illegal reason. Generally, the way we do that is by using progressive discipline, which basically comes down to communicating to employees when they’re violating a policy or when their job performance isn’t satisfactory, and then giving them a chance to improve. Of course, as an employer, you want to keep documentation of this communication, whether that’s by coaching, oral warnings, written warnings, or performance improvement plans. Using progressive discipline and having this documentation isn’t a guarantee that you’re not going to receive a discrimination complaint, but it can definitely reduce the chances of that happening.
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All right, next up is the Equal Employment Opportunity Policy. Again, this, I think, is vital to every handbook. An EEO policy says that the company doesn’t discriminate against employees based on a protected characteristic. They’re also referred to as protected classes, I personally prefer the term characteristic because everyone’s part of a protected class. We all have a race, a gender identity, religion, non-religion, et cetera, so it’s a little bit more inclusive.
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I’ve listed out the federally protected characteristics at the top of the slide. Chances are that you’ve heard of at least some of them. And then the second list are just examples from various state laws. Most states do provide some protections beyond what federal law protects. This list doesn’t have all of them, it’s just kind of a sampling to give you an idea of what else is out there. The idea behind EEO protections is that applicants and employees should be judged based on their work performance or work product or qualifications for applicants, rather than a characteristic that doesn’t affect their job related knowledge, skills or abilities.
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In some cases, like disability discrimination, the focus is about equity rather than equality because employees with disabilities may need an accommodation that other employees don’t get so that they have access to the same employment opportunities. Having an EEO policy in your handbook communicates to the company’s commitment to fairness, which can help with employee morale and retention.
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Of course, another advantage to having an EEO policy in your handbook is as an educational tool to avoid violating anti-discrimination laws and as a result, maybe receiving a discrimination complaint. It’s common for handbooks to list out the federal protections and then say, and any other class of protected under state law. I think the catchall is really nice to have, but I don’t recommend relying on it. So the reason for that is if an employer or manager isn’t aware of all the characteristics that are protected by both state and federal law, then they’re more likely to run a foul of them. So listing out all the applicable protected characteristics in your EEO policy will really help set you up for success.
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One thing to note is that harassment is a form of discrimination when it’s based on a protected characteristic. Most handbooks will have a separate EEO policy and a separate harassment policy, which is fine, and that happens to be my preference. I just want to point out that harassment is a type of discrimination if it’s based on a protected characteristic.
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Moving on to employee exempt versus non-exempt classification. So the big picture here is that non-exempt employees have to be paid over time. Exempt employees don’t. Paying a salary is one requirement for the most common exemptions, but there’s also the job duties tests. As far as your handbook goes, you should say that employees are non-exempt unless the company tells them otherwise in writing, and various policies might set out, or might specify which group the policy applies to. But your handbook isn’t going to set up the criteria to determine the proper classification for position, with one exception. So as I’ve noted on the slide here, one of the criteria for being classified as exempt is being paid on a salary basis. I do recommend having a Safe Harbor Deductions policy in your handbook, and basically that is going to help preserve the exemption if you accidentally take an improper deduction.
(00:20:09):
So let me dig in on that for just a moment. So one of the requirements for classifying an employee as an exempt administrative executive or professional employee is that they’re paid on a salary basis, which means that they are guaranteed their weekly salary other than for permissible delineated deductions. One of those deductions is when they’re taking leave under the Federal Family and Medical Leave Act, for example. So I recommend having a policy that lists out what these permissible deductions are and telling employee, or at least exempt employees, that if the company makes an impermissible deduction to report it to the company and that will give you a chance to fix it and preserve the exemption. Now I kind of went a little bit deep on that. This is a really important topic if you have any exempt employees, so if you’re not familiar with the nuances of the criteria to classify someone as exempt, I recommend spending a little time digging in to make sure that you are dotting your Is and crossing your Ts.
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I also like having a policy near the beginning of the handbook that sets out the definitions for full-time versus part-time, just because those might get referenced throughout the handbook. I spoke earlier about that identifying which employees certain policies apply to and a lot of time that is made on the full-time versus part-time distinction. In terms of the general definition, it’s really up to you where you want the cutoff to be. It could be 40 hours a week, it could be more than 20 hours a week, but having said that, there are certain laws, for example, the Affordable Care Act that do have a specific definition for full-time. Under the ACA, it’s 30 hours a week, and if your state law or your policy might have a specific requirement for health coverage too. So if there is a specific definition, you’ll want to make sure that you are applying the right definition, but it’s fine to have one general definition that applies to nine out of your 10 policies and then a different definition for specific benefits.
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All right, next is conduct. Your conduct and behavior section is primarily going to cover things we’d consider bad behavior by employees. How that behavior should be reported and what the consequences are. So among other things, this section should include your harassment policy, complaint procedure, and a policy about employee discipline or corrective action.
(00:23:09):
I would like to spend just a moment on that last point. I’ve noticed a lot of employers want to have a strict step discipline policy in their handbook, and my perspective on that is to try to keep it out of your handbook if you can. I think it’s a great idea for managers to have guidance about what the steps are, but I don’t want to spell it out in a handbook because that limits your ability to tailor the level of discipline according to the severity of the offense or surrounding circumstances. So what I recommend doing is having a somewhat vague corrective action policy that simply indicates appropriate corrective action will be taken, and then separately, outside the handbook, providing guidelines for managers to apply so that similar situations are treated the same. And that in practice can kind of look like a step process. I’d just rather not have it spelled out in the handbook because that makes it a little bit harder to deviate from.
(00:24:16):
Okay, the compensation section of your handbook should clearly state pay periods, including when your work week starts and ends, should say when payday is, give specifics about your timekeeping procedures like when employee should be clocking in and out. As far as overtime, so under the Federal Fair Labor Standards Act, it’s all time worked beyond 40 hours in a work week, but a good chunk of states have their own overtime laws including for daily overtime, so make sure whatever applies to you is in your handbook.
(00:24:53):
If you do performance evaluations, you can have a policy about that. If you’re aspiring to do them, but it’s not part of your regular practice, then I’d say wait until you’ve got it established before putting it in writing in handbook. If you do have a policy that talks about performance evaluations, don’t promise a pay raise in your policy, what you can do is kind of share the factors of the company uses to determine merit increases, and then with bonuses, sometimes that’s hand in hand with performance evals, sometimes not. It’s up to you whether you want to have your bonus policy in your handbook. I think if it applies to all employees and it’s pretty straightforward, it’s good to have in there. In contrast, if only one department is eligible for a bonus or if it’s pretty complicated or changes often, then I’d say just keep it out of the handbook, have it in a separate document.
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All right. The benefits section is going to cover perks as well as mandatory benefits. So we’re talking about holidays, paid time off, health insurance, as well as protected leaves required by federal law or the states that you operate in. Many of these mandatory leaves don’t necessarily have to be in the handbook, but some of them do. And even if a law doesn’t have a specific policy requirement, I still do recommend putting it in your handbook. If nothing else, having a policy will increase the chances your managers have at least heard of these required leaves, or will know where to look if they get a request so that they’re not going to deny a leave request that an employee is actually legally entitled to.
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So I’ve listed out some of the federal protections benefits here. There’s the Federal Family Medical Leave Act, military leave, disability leave, and accommodations, lactation accommodations, and coming in June, pregnancy related accommodations. So we’ve always recommended that employers provide pregnancy related accommodations to avoid a potential claim under the Pregnancy Discrimination Act and the Americans with Disabilities Act, but the case law was actually a little bit nuanced when it comes to pregnancy related accommodations.
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So just this last month… Yeah, last month in December, Congress passed and President Biden signed a law into place called the Federal Pregnant Workers’ Fairness Act, which requires that employers provide pregnancy related accommodations, as long as the accommodation doesn’t cause an undue hardship. That is going to take effect in June of this year, but a handful of states already have what are known Pregnant Workers’ Fairness Laws on the books, so you might actually already be subject to one before June.
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So that’s a good segue in a state specifics, and generally speaking, most employment laws are at the state level. I’ve set out some of the heavy hitters here, but this list definitely doesn’t have everything. Probably the bulk of state specific benefits are going to be leave laws, and two of the biggest trends we’ve seen lately are, especially last year, are bereavement leave and paid family and medical leave. These state paid family and medical leaves are interesting in part because some of them have job protection and some of them don’t. My general recommendation is that if the leave doesn’t have job protection, don’t put it in your handbook. If there’s a notice or requirement, you can provide the notice as a separate document, and that just avoids basically promising an employee reinstatement if you’re not legally required to do that.
(00:29:04):
Accommodations for disability in pregnancy might kick in if you have fewer than 15 employees, which is the threshold for the Federal ADA and Pregnant Worker’s Fairness Act. Excuse me. Lactation accommodations might extend beyond a year after childbirth, or they might require specifics like an electrical outlet or refrigerator. And in two states, lactation accommodation or lactation breaks actually have to be paid. Excuse me.
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Another accommodation we’re seeing more of is for domestic violence. For example, if an employee is a victim of domestic violence, maybe they need a specific safety protocol, or not having their picture displayed on the company webpage or something like that. Some states have what are known as mini COBRAS, which often have more employee friendly requirements than the federal COBRA, so just make sure that your benefits continuation policy is accurate.
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Federal law doesn’t require meal or rest breaks, but most states do, so you’ll want to have policies covering them, if applicable, or even if you’re not required to provide one, if you choose to.
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There are also some oddball ones that I like to mention. They’re not really breaks, they’re not really leaves. A few states entitle veterans to take Veterans Day off from work. Some states have Day of Rest laws, Kentucky entitles employees to take Labor Day off. DC has Emancipation Day. So whatever applies to you, you just want to make sure that you have a policy for those types of employee entitlements too.
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Another state specific requirement to check for is whether you have to pay an employee for their unused vacation when they separate from employment. Pretty much any possible variation you can think of is out there, so make sure that you know the requirements in your state, and I should also say that if you promise the payout vacation, even if you’re not required to, you can be held to keeping that promise.
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If you have employees in multiple states, there are a couple ways you can go about including state specific information. Option one would be to use the policy that is the most employee friendly and basically give that benefit to all employees, regardless of the location. I’d say probably most employers don’t choose that option. Option two would be to intersperse state specific policy throughout your handbook by topic. And then option three would be to create state specific addenda so that all your, let’s say for example, California specific employees go to California addendum and then are given to California employees, and then you have a New York addendum for your New York policies and you get that to your New York employees. That’s personally my preference. I think it’s just kind of neater and easier to stay on top of an update.
(00:32:14):
Before we move on, I want to take a moment to talk a little bit more about pay time off and vacation. When I talked about paid vacation on the last slide, having to be paid out, that generally applies to pay time off too. At least it’s safer to consider it, even if the vacation payout law doesn’t specifically talk about PTO. And then, as most of you answered in the poll, you’re dealing with your vacation or paid time off policy the most often, at least of the options I gave you. So I think just think it’s really helpful to be as clear as you can in your PTO policy about the details.
(00:32:59):
In some cases, if your policy is silent, it can be interpreted the way that’s most favorable to the employee. For example, some states say that PTO on vacation has to be paid out at termination, unless your policy says that it won’t be. So if you don’t want to pay out unused vacation when an employee gets fired or quits, you should say that in your policy. And on the other hand, if you don’t say it, then you’ll be on the hook for paying out at termination. Plus, I think with something as frequent as PTO on vacation, it can be helpful to get out in front of potential employee disagreements to the extent that you reasonably can by being clear in your policy.
(00:33:49):
All right. Another area to cover in your handbook are health and safety policies. I recommend including a no smoking policy, even though people aren’t as likely to light up in the office anymore, it can still be helpful for a couple reasons. Number one is vaping. Sometimes people think that vaping is allowed everywhere because it’s a lot more discreet than cigarettes are, so if you want to prohibit it, then I would just recommend calling out vaping too. And then number two is company cars. Again, sometimes people who smoke think that a no smoking policy doesn’t apply in the car and if you want it to, I think it’s just easier to say that.
(00:34:28):
In my experience, drug and alcohol policies are a little bit of a wild card. I do recommend having one. It doesn’t have to be zero tolerance, but it should tell employees what’s prohibited, which is usually at least on duty use and impairment. If they’re going to be subject to testing, tell them that generally it’s for reasonable suspicion, if nothing else. But I should note that state laws really vary when it comes to what employer’s rights are as far as drug testing their employees. So you do want to make sure that your policy and practice complies with state law. And the same goes for contractual requirements and federal regulations.
(00:35:18):
With a worker’s compensation policy, we want to let employees know in writing that if they get hurt during work, they’re going to be going through the worker’s comp system. And hand in hand with that, we want employees to tell us right away if they get hurt or if they witness someone else get hurt during work.
(00:35:38):
Workplace violence is where I lay out a no tolerance policy for violence and threats of violence. I also recommend putting in there that violations will result in discipline up to including termination. I don’t think, and I don’t recommend having that line in every policy, but I do like having it in the violence policy or the anti-violence policy and specifically referencing termination there.
(00:36:08):
This section is a good place for driving safety tips, especially about cell phone use. Even if you have employees only occasionally running an errand for the company, it’s still a good idea to cover driving safety. It’s not going to necessarily eliminate your liability if an employee gets into an accident, but hopefully by following the safety requirements, they’ll be less likely to get into an accident.
(00:36:38):
Last on the list, they’ve got office closures. It’s mostly an inclement weather policy, but it can cover other things too like power outages. This is where you’d want to include whether employees get paid when they’re sent home or told not to come in, whether it’s because of whether or some kind of emergency. You can require that employees who are sent home will have to use paid time off, and you can also set the expectation that employees will work from home if they can. Of course, I should say you want to be reasonable in practice with that. The weather is extreme, they may need to evacuate. We’re seeing that more often, for instance with threats of wildfire, hurricane, things like that.
(00:37:28):
The next section should be workplace guidelines. This is a pretty good catchall for anything you have left. What’s on the slide here is just a sampling of what could be included in this section. So we’ve got off-the-clock work that prohibits employees from working off-the-clock, or another way to say that is reporting all time worked, and that just reduces the chance of a wage and hour complaint.
(00:37:52):
Meal and rest periods, again, whether you’re required to provide them by state law or if you’re not required, have chosen to. Reporting irregularities, this is things like fraud, theft, embezzlement. Social media, there’s not a whole lot employers can do when it comes to social media, but you can tell employees not to speak for the company and not to harass coworkers on social media. Attendance and tardiness, that’s kind of going to set out you know what your standards are there, what the procedure is for calling out.
(00:38:28):
Personal appearance and hygiene. You don’t have to have this one in there, but I do recommend having something even if it’s vague, just because if you have an employee with a body odor issue, it’ll give you an anchor for that awkward conversation. Electronic asset usage, so this is about computers, hardware and software, cell phones, any kind of electronic device. You don’t have to cover everything about electronics, but I do recommend prohibiting pornography or seedy materials just because at least I’m surprised by how often that comes up. And parking. If you provide commuter benefits, you, it’s a good place to put that in your handbook, and then if you have any specifications about where employees are allowed to park, you can list that there too.
(00:39:26):
Finally, we want to say a few words about what’s expected when an employee quits or is terminated. In our handbook we like to ask for two weeks notice. You can request more than that if you want. Just be sure that you’re not requiring advanced notice, because that undermines the at-will employment relationship, which I’ve noted here. I’d like to reiterate the at-will employment relationship, again, saying that the relationship can be ended at any time by either party, with or without cause, with without notice.
(00:40:01):
We want to let employees know that when they leave, they need to take their stuff with them and give our stuff back. We do get asked a lot about taking a deduction from employee’s final paycheck when they don’t return company property, and there are a lot of state requirements there. Some states allow, prohibit it. Some make you go through a lot of hoops. And then even if there’s not a state specific restriction, the Federal Fair Labor Standards Act doesn’t allow any deduction to take the employee below minimum wage.
(00:40:44):
Okay. I also recommend putting a line somewhere in your handbook that it’s not intended to infringe on employees’ rights under the National Labor Relations Act. So under section seven of the NLRA, employees have a right to discuss working conditions with each other, technically, as I’ve listed on the slide, protected concerted activity. And that’s true even if they’re not in a union. And this right to [inaudible 00:41:09] protected concerted activity is really broad. It covers employees discussing their wages, complaining about their boss or the company, forming a union, and pretty much anything that involves their interest as employees. The most common misstep we see is employers telling employees that they can’t discuss their wages with other employees, and I just want to say that that prohibition is illegal, so please don’t put it in your handbook.
(00:41:40):
I also want to just point out that this protected concerted activity can happen on social media. One case that sticks out in my mind is an employee who posted on her Facebook page complaining about the company, and then a coworker liked that post. She didn’t comment on it, she just hit the thumbs up button, and that was held to be concerted protective activity, so the employee was protected and couldn’t be terminated for posting on Facebook. I’ll also throw out, I don’t recommend friending employees on Facebook, following them on Twitter, any kind of social media really, just because it’s a minefield that is easier to avoid if you can. All right, but the point of this slide here is that you do want a statement in your handbook somewhere that it’s not intended to interfere with employees NLR rights, and then also make sure that you’re not actually violating those rights in practice.
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The last page in the handbook is going to be the acknowledgement page. So now that you’ve got everything compiled into your handbook, you want to make sure employees get it and read it. I do recommend providing time during orientation for new hires to read the handbook. You probably can expect it them to take 45 minutes, an hour, somewhere around there, to get through the whole thing. Non-exempt employees do need to be paid for all hours worked, so if you choose to send the handbook home with them, you do have to pay them for that time. And of course if they’re doing it at home, maybe they’re watching Netflix or something, so another good reason to have them do it at work.
(00:43:34):
All right. The most important piece though is really that they signed the acknowledgement saying that they received it. The acknowledgement can say different things like that they received it, that they read it, that they had an opportunity to review it, that they had a chance to ask questions, that they understand that they’re subject to the policies or could be disciplined for violating them.
(00:43:55):
What I don’t recommend saying is that the employee agrees with the policies, because we don’t need their agreement to hold them accountable. What we do want is documentation showing that they received the handbook. Every once in a while we hear about an employee who refuses to sign the acknowledgement form. Sometimes if you can explain that failure to sign doesn’t exempt the employee from being subject to the policies, then they’ll go ahead and sign. If not, what you can do is have a supervisor come in or write that the employers read the handbook and then sign and date that on the acknowledgement page, and then the belts and suspenders approach is to have someone else, like a second person come in and do the same thing.
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I also like to mention somewhere in there that the company can make changes to the policies at any time and without advanced notice. That’s more for optional benefits than mandatory things, but it’s just a nice little line to have in there. And then last, make sure that each employee’s personnel file has a copy of the signed acknowledgement, or multiple acknowledgements for revisions, supplements, things like that.
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So now that we’ve looked fairly closely at what topics are in your handbook, let’s talk a little bit about the language. Here are my general dos. Strive for consistency in language and tone. This can be hard if multiple people have contributed policies over the years, but the goal is to have the entire handbook feel like it’s written by one person. You want to try to avoid fancy language as much as possible. Again, the goal here is to use clear, simple language so that employees can understand what the policies say.
(00:45:57):
You want to apply your policies consistently. That means treating similar situations similarly. So you can have some variation to account for circumstances and severity, like I mentioned earlier, but you don’t want to leave it up to each manager’s discretion because that’s a recipe for inconsistency and could give rise to a complaint of discrimination. One thing I like to note is that consistency doesn’t mean you can’t ever change a policy or how it’s enforced, just be sure to communicate and document the change and then be consistent moving forward.
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I like using phrases like generally, from time to time, as needed, because it can provide you a little more flexibility when you’re allowed to have that flexibility. Let’s say for example, you say employees are generally allowed to take an hour-long lunch break. Well, if you have a particularly busy day and you can’t afford to have people out for an hour-long lunch break, then you can ask them only to take a half an hour lunch break instead, and they won’t be able to put up too much of a fuss about that.
(00:47:12):
Finally on my shortlist, we want to be balanced in terms of detail. We want to provide enough guidance to employees and managers so they know what to do and what’s expected of them, but not so much that it’s impossible to wade through all the information. For example, you don’t need to list every single permutation of misconduct. Instead, you can use some general categories of bad behavior and that can cover a wide range of things.
(00:47:44):
Here are some things you want to avoid because they can reduce your ability to be flexible, they can weaken the policy itself or put the at-will employment relationship at risk. So probationary periods should be called introductory periods, unless you’re in Montana, then you should use probationary. Not only does the term probation set kind of an uncomfortable tone, but it can undercut the at-will employment relationship.
(00:48:13):
You also don’t want to make any promise or imply promises of guaranteed employment. We don’t see it too often anymore, but handbooks used to say things like, as long as the employee does a good job, they’ll have a lifelong career here at ABC Company. If you’ve got that in yours, I recommend pulling it out.
(00:48:35):
I’ve mentioned step discipline. Again, in most cases, I want to avoid putting that in the handbook itself. If you do have it listed there, then you can be held to going through each of the steps, whether that’s three, five, seven, before reaching termination. And you don’t want to have to do that for serious violations, egregious misconduct.
(00:49:03):
And then finally, we don’t want to have policies that are actually contracts in the handbook. I would generally say talk about non-competes, they need to be their own contract or part of a larger contract, but the Federal Trade Commission just proposed a rule that has an all out ban on non-competes, so we’ll see what happens with that. But the point remains that if a policy is really a contract, we want to have it as a separate document out of the handbook, because the handbook itself is not a contract and we don’t want to make it look like one.
(00:49:42):
So once we’ve got everything in the handbook, we should ensure that your formatting looks good. Make sure your fonts are consistent, you’re going to want to run spellcheck. And then even with spellcheck, I do recommend proofreading just because spellcheck doesn’t catch everything. It’s also a good idea to have a table of contents for quick reference. You can make a table contents, excuse me, automatic so that you don’t have to figure out the [inaudible 00:50:14] on your own, you can just update it with a click.
(00:50:17):
If you’re using pictures to break up the text, I recommend keeping them tasteful. You also want to make sure they’re not copyrighted, and if you’re using pictures of employees, get their written permission to have them in there.
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All right, let’s pause before jumping into our final section for our second poll. So the question is, how many people work on your company’s employee handbook? Got the options there, one, two to three, four or more, I don’t have a handbook. All right, answers are rolling in. I’ll give about five more seconds. And I’ll go ahead and close the poll. All right, so we’ve got just over 50% take two to three people work on the handbook. A fair number of you are by yourselves. Oh, that’s tough. It’s quite the task. All right, thanks so much for participating. Go ahead and close that. Oopsy. Did I go to… No, there we go.
(00:51:38):
All right, so let’s talk briefly about how to administer your handbook once you’ve got one. As for distribution method, if that’s really up to you. You can give each employee a paper copy, you can send it by email, post it on your company intranet, whatever works best for you and your employees. What I tend to suggest most often is if you have employees with work email addresses is to email them a copy, have them print the paper acknowledgement page, sign it, and return it to you, and then leave a printed copy at somewhere accessible at your workplace, so it’s easy for employees to reference when they need to.
(00:52:20):
I do recommend that you give the employee the handbook on their first day of orientation. As I mentioned earlier, give them time to read it. But if you are sending it home, I’d say give them a deadline of when to return the acknowledgement back. Five to seven days is probably long enough for them to do it, but not so long that you lose track of it.
(00:52:45):
Managers and supervisors, these are the people who are going to spend the most time with employees, so they should really be familiar with the policies and procedures. And you can do different things to help train them, you can make a fun quiz, but you just try to have them be as familiar as possible.
(00:53:10):
Our final topic of the presentation is about reviewing and updating your handbook. I recommend reviewing the handbook at least once a year. Many employers choose to do it in December to start the new year fresh. That’s a great practice, and nothing needs to be updated, then you’re done. Something does need to be changed, then I recommend sending out the updated version to all employees and collecting their signed acknowledgements for the new version. And then for changes that happen between annual updates, my recommendation is to send a new policy as a standalone document with an acknowledgement page specific to that policy, and that’ll hold you over until you send out the next version of the entire handbook.
(00:53:57):
So most new changes are probably going to come from a law. In terms of keeping up with the law, you can expect to see changes taking effect most often in January or July, but they can take effect any time throughout the year, and even some of them immediately. Fortunately, we do have a team here that tracks this stuff so you don’t have to. I’ve listed out a few examples of the new and amended laws we saw in 2022. As I mentioned, not every law needs a policy. For example, you don’t need a pay transparency policy. You just have to, even the new states that are requiring that you put them in your job ads, you don’t have to have a policy about that, you just have to do what you’re required to do.
(00:54:45):
The other source of handbook updates come from internal company changes. So if you grow, you might be subject to new employment laws, or if not a new law, a new to you law. For example, a lot of sick leave laws have different thresholds. Maybe for one to 10 you have to provide protected sick leave, but it can be unpaid. And then 11 or more employees, you have to provide paid sick leave. So just make sure you are updating your policies as new requirements apply to you.
(00:55:21):
And then changes in structure. If you reorganize and have new names of departments or job titles that are referenced in your handbook, or maybe now you have middle managers that employees report to, just make sure that whatever’s referenced in your handbook is updated. And last, changes in benefits. If you change your vacation policy or really anything that’s in your handbook, just make sure that you update that as well.
(00:55:50):
So as far as implementing the new policy, if it’s an optional policy, I think it can be really helpful to get input from management, if nothing else, just to get some more buy-in since they’re the ones that are going to be enforcing the policy. And then I’d recommend the steps outlined here. So write the policy, make sure it doesn’t conflict with another policy, distribute the policy to employees and get their signatures, and then plan to add it to the handbook the next time you do an update. You could do a full handbook update every single time you change a policy, but that’s probably going to be overwhelming both for you and your employees. All right, this final note just says it’s important to follow your policies in terms of what they say, doing what you say you’ll do, if not for compliance, then for maintaining credibility.
(00:56:48):
All right, my voice held out. Thank you for bearing with me. I know that was a lot of information. I’m going to take a quick pause here and look at your questions you’ve chatted in. Looks like we may run over by a minute or so, so if you do need to drop off, you will get a recording of the presentation. I’m going to put myself on mute and go look at those questions. Be back in just a moment.
(00:58:05):
Okay, I am back. We have a ton of questions. Thank you so much for chatting them in. I’m going to just start at the top and work my way down. What would you include in a handbook about sharing inappropriate information about personal life? Honestly, I wouldn’t recommend putting anything about that. I would deal with that as it comes up. There’s employees, unless you’re in Connecticut, employees don’t have, in the private sector, the right to freedom of speech in employment, but they do have the right to engage in protected concerted activity. So it’s really hard for employers to regulate employee speech at the end of the day.
(00:58:57):
What I would recommend, and employees spend a lot of their life at work and they can form meaningful friendships with their coworkers, so I wouldn’t put anything in your handbook as far as a prohibition, but I would deal with circumstances as they arise. For example, if someone’s talking about their sex life, that’s going to implicate your sexual harassment policy. If someone else is complaining about it because it’s distracting them from their work, then just have a coaching conversation. But yeah, there’s nothing specific I would put in your handbook about that.
(00:59:37):
Another question, what would you include in a handbook about how to deal with irate and rude customers? That’s an interesting question. I don’t think I’ve written a policy about that specifically, like the protocol about what you should do. I have put in the professionalism section, I’ve written something about maintaining a professional demeanor even with mean customers or clients. If you do have public facing employees in person, then I would recommend having some kind of protocol. Usually it’s getting another manager or getting a manager, I should say. I tend not to, my personal preference is not to immediately call the police. Usually if you get someone else in the position of authority to come and deal with an array or rude customer that can really help calm the situation down. If it doesn’t, then I would take that information, their complaint down and escalate it up from there within the company. Of course, if someone’s violent or threatening violence, that is a situation where I would recommend calling the police.
(01:01:13):
Let’s see. How many languages are we required to supply? I’m trying to rack my brain. I can’t think of a state that requires the handbook to be in another language. Maybe it’s out there. There’s nothing under federal law that’s going to apply, that’s going to require translated versions of your handbook. Some state laws do require notices to be provided in translated or multiple languages. There’s usually like a threshold, like 5% of your workforce or 10%. It, of course, even if it’s not a requirement, it’s still a good idea if you do have employees who don’t speak or read English as their first language to translate it for them. And the reason for that is because you are going to be holding employees, hopefully, accountable to your policies. And so you know, want to provide the information in a way that they can understand it so that they can follow it.
(01:02:20):
Are there any policies that should apply to all employees as a standard of operations, like attendance, dress code? That’s going to depend on your type of organization, the different employees you have. I mean, I would say your conduct policy is going to apply across the board, but different types of employees can have different dress code requirements. Your harassment policy is going to apply across the board, your EEO policy. So yeah, there are definitely some of them that will apply across the board, but many others can vary by job classification, department, a number of things.
(01:03:00):
Does the employer have to give a reason for termination? No. Well, no, qualified. Some state laws require that if an employee asks for the reason that they were terminated, you have to provide it and it’s usually a written requirement, you have to write it in writing. I don’t think any state requires you to do that proactively, and federal law doesn’t. Having said that, you definitely want to give the employee a reason for termination, and the reason for that is because if you don’t, then they will probably think that the reason is an unlawful one, like you’re discriminating against them, or it’s because they just came back from family and medical leave, or something like that.
(01:03:46):
So I would say two things here. Number one, terminations should not come as a surprise. An employee should see the writing on the wall before that termination meeting happens, unless it’s a one-off egregious offense, which would be a clear violation of your policy, like a violence policy I mentioned earlier. So number one, give them an opportunity to improve by telling them that they’re not doing a good job. And then two, it just helps prevent a discrimination complaint when you tell them why you’re letting them go.
(01:04:29):
How do you feel about the SHRM template? I don’t know that I’ve actually seen it, so I can’t comment on that. Let’s see. Oh, we are about five minutes over time and let me just get to another question or two.
(01:04:45):
Can there be part-time salaried employees? Is the state specific? Yes, there can, you can have a part-time salaried employee. I’m assuming by salary you mean exempt? It’s possible, although I don’t recommend it. So one thing is you have to meet the minimum salary threshold, which if they’re super part-time, you may not be meeting, so you got to check for that. And then it’s just a little bit harder to implement in the real world when you have the salaried exempt employee. So I would recommend if you have a part-time employee to classify them as non-exempt. Non-exempt is the default. And you can always classify an employee as non-exempt, even if they do qualify as exempt. With part-time employees, they’re not going to be working probably overtime and that’s the main advantage for you as an employer as classifying someone as exempt is not having to pay overtime. So that motivation, I guess, isn’t there for part-time employees. So my recommendation is to just classify them as non-exempt if they’re part-time.
(01:06:03):
Does complaint procedure mean internal complaints or complaints from people who are not employed by the organization? Good question. Complaint procedure is about internal complaints.
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Okay, I think I am getting the signal to wrap up here. Do federal and state employment regulations and laws apply to businesses with fewer than 10 employees? Yes. The Federal Labor Standards Act applies to employers of all sizes. There’s not a minimum employee threshold. The USARA military leave and anti-discrimination protections apply to employers of all sizes, the NLRA applies to employers of all sizes, and then a lot of state laws, I don’t know how many, a fair number of state EEO laws apply to employers of all sizes. So yeah, there are a lot that are out there.
(01:06:57):
Okay, I think that’s all I’m going to be able to get to today. Thank you so much again for joining me. As a final reminder, we will email you a PDF of the slides, as well as a recording in about 24 hours. And I hope you have a great rest of your day.
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