Create an Employee Handbook

To prepare an effective employee handbook, you need to understand your current policies (both written and unwritten), past and current practices, and anticipated future needs.​​​ An employee handbook communicates your company's expectations and provides clarity to employees. A properly drafted and legally compliant employee handbook can help you if you ever face an employment-related lawsuit. Follow these steps when creating your handbook:

 

1. Assess Your Audience

Determine who is covered by the handbook. Consider:

• The size of your workforce
• The type of workplace (e.g.; office environment, warehouse, beachside restaurant)
• Your geographic scope of operations (e.g.; multi-state operation, international, California only)
• Employee job duties

 

2. Assess Your Policies and Practices

Written or not, your company does have policies and practices. Current policies provide a foundation for your handbook. After reviewing your policies, revise or consider eliminating any that are outdated or do not match your actual company practices. If your company is not following its policies, find out why: Do practices need to be changed to conform to the policies? Or are the policies themselves outdated and do not reflect current operating practices?

To determine your current policies:

• Gather all existing written policies, including any memos, emails or other communications regarding the policies and how they are implemented.
• Survey managers and supervisors to determine unwritten policies and practices
• Review payroll and business practices and personnel record maintenance procedures (e.g.; When do you pay employees? Who do employees go to with questions about their paychecks?)
• Obtain copies of benefit plans
• Review any documents related to recent litigation, such as wrongful termination or discrimination lawsuits. Did the litigation reveal any problems with company policies or practices that need to be addressed or reinforced in your employee handbook?

 

3. Determine Your Need for New Policies

After examining your current policies (see Step Two), identify any issues or practices for which a clear policy does not exist. To help make sure you cover all issues, interview employees. Also, consider:

• Your long-range organizational goals and operational needs that you have not addressed.
• Whether you have reduced or increased the size of your workforce, since new or different policies may be applicable to your updated workforce.
• Emerging trends, such as the rise in social media use, and whether you need policies to address such trends.
• New laws, such as any leave protections, that may apply to your workforce.
• Required policies, such as a harassment, discrimination and retaliation prevention policy, that are mandated by California law.

 

4. Begin Drafting New Policies

Drafting consistent, understandable and legally compliant employment policies is a difficult task. However, your effort can result in significant long-term benefits. Ideally, your handbook should contain policies that are:

• Carefully and clearly worded, as well as accurate reflections of your policy consistent with applicable legal requirements that can be understood by the audience
• Consistently enforced by supervisors and managers

 

5. Review Your Document

After completing the initial draft of an employee handbook or policy manual, submit the draft to company managers for their review to get differing perspectives and to uncover omissions or inconsistencies. In addition, early consultation regarding employment policies makes managers and supervisors more likely to be supportive when these policies are implemented.

 

6. Review by Legal Counsel

Ask legal counsel to review your handbook before you distribute it to employees. Although your handbook provides structure for employees and guidance for managers, it is primarily a legal document. Make sure that you have not violated the law, or put yourself in a vulnerable position with the language you have used.

 

7. Train Your Supervisors and Managers

Consistency in applying policies is fundamental to good personnel relations and critical to the favorable resolution of allegations of unlawful discrimination and other claims. It’s important for employers to orient and train supervisors and managers when implementing new or revised policies.

Before distributing the materials to non-supervisory personnel, make sure that supervisors understand the policies, how to apply them, what they mean and any required administrative procedures.

 

8. Distribute Your Handbook

Distribute the handbook before the policies are implemented. For existing employees, either meet with them, or prepare a cover letter to accompany the handbook when you distribute it. This allows employees and supervisors to review the new information and raise any issues requiring clarification.

Advanced distribution also prevents any implication of a forfeiture of benefits or compensation earned before the effective date of the new policies. Forfeiture of any benefits that have been “vested” before implementing the new policies is unlawful.

Consider redistributing your handbook at least once annually or, at the least, whenever it is updated.

Consider whether you need to translate your policy into any additional languages. Translation into languages spoken by your workforce is important to ensure understanding and also may be required by certain laws. For example, California law requires employers to translate their harassment, discrimination and retaliation prevention policy into language(s) spoken by more than 10 percent of their workforce.

 

9. Document the Distribution

Record the date(s) of distribution and the names of employees to whom you distribute the new or revised employee handbook. Each employee should sign a confirmation of employee handbook receipt. Employers should also obtain a separate acknowledgment of receipt of their harassment, discrimination and retaliation prevention policy. Keep the signed forms in the employee's personnel file.

If an employee refuses to sign the form, inform the employee that the policies contained in the handbook will be implemented as of the effective date and that their continuation of work and receipt of wages will be considered acceptance of the terms of the handbook. If the employee still refuses to sign the receipt form, inform the employee again, in writing, and retain a copy of that notification.

 

10. Monitor Your Handbook's Effectiveness

Verify that the terms in the handbook are uniformly applied throughout the company and that all employees, supervisors and managers follow them.

 

11. Revise Your Handbook Periodically

Ask managers, supervisors and legal counsel to review your handbook periodically. Determine if you need to remove or revise certain provisions or create additional ones due to a change in the law or a compelling business need.

Distribute any changes in writing, and make sure you state that this version supersedes all previous versions. Keep a copy of all changes and new policies in a central file, so you can track and reference them easily.

If the changes are substantial, employees should sign a new confirmation of employee handbook receipt form.

Be sure to specify that you reserve the right to amend or revise the handbook at your discretion.