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The Essentials of Developing an Employee Handbook

The Essentials of Developing an Employee Handbook


Reviewing the employee handbook is among the first tasks assigned to a new hire, and with good reason. An employee handbook sets the tone for the employee and allows the employer to outline expectations and provide a framework for proper communication and conflict resolution. While employee handbooks cannot be considered legal documents, employers typically have employees sign off that they’ve reviewed the handbook and understand the content.

Because the employee handbook is an important resource for a company, it is important for you as an HR professional (since your department will typically draft and maintain this document with the input of stakeholders) to know what to include for the employee handbook to be effective. “Effective” may be a subjective term, but in this case, it means that the employee handbook gives employees guidance and information related to the organization and protects the organization against claims of unfair treatment or discrimination.1

Let’s explore the elements that should be included in an employee handbook, how to put the handbook together, and the best practices around distributing and maintaining the document.

What Is an Employee Handbook and Why Does It Matter?

Starting with the basics, an employee handbook is a clear-cut document that outlines a company’s policies and procedures. It also lays out any organizational expectations. It is not an employment agreement, so be sure to avoid using legal jargon. To avoid any confusion of the legal status of the document, be sure to include a statement early on that makes it clear to employees that the content of the handbook does not constitute an employment agreement.2

Employee handbooks benefit both employees and employers by establishing a positive and productive work culture.

Benefits of the handbook for employees include:

  • An understanding of company policies
  • Clear expectations of performance and behavior
  • A sense of the organization’s commitment to its workforce
  • A resource to turn to when questions arise

Benefits for employers include the opportunity to:

  • Establish performance standards and behavioral expectations to promote a positive and consistent workplace culture
  • Create a framework for conflict resolution
  • Outline essential policies and procedures
  • Reduce legal liability by laying out relevant laws and regulations
  • Demonstrate a commitment to compliance

Key Sections and Elements of the Employee Handbook

Understanding the key sections and elements of the handbook is a good starting point as you sit down to draft or update this document for your company.

The key overarching categories typically included in an employee handbook are:

  • Company mission statement, values, and/or history
  • Company policies, standards, and guidelines
  • Career, compensation and benefits information
  • Company procedures

Under each category you will include information as needed for your company to create a robust and comprehensive document that is still user-friendly. Let’s delve into ideas of what can be included under each category. These lists are not exhaustive, but should give you a good idea of what can be included.

Company Mission Statement, Values, and History

  • Welcome letter to new employes that also acknowledges current employees
  • Mission statement and/or values statement
  • History of the company with any relevant culture information
  • Equal opportunity statement
  • At-will statement
  • Disclaimer that this handbook is not a contract of employment
  • About the handbook or purpose of the employee handbook

Company Policies, Standards, and Guidelines

  • Hours of work expectations, including meals, breaks, and overtime
  • Attendance expectations
  • Anti-harassment policy
  • Non-discrimination policy
  • Code of conduct
  • Americans with Disabilities Act
  • Relevant OSHA information
  • Timekeeping standards
  • Personnel recordkeeping
  • Use of the phone, email, internet, and company property
  • Any standards or expectations about social media, whether work related or personal
  • Any dress code requirements/expectations

Career, Compensation and Benefits Information

  • Process for performance evaluations
  • Promotions and raises
  • Internal transfers
  • Terminations and layoffs
  • Paydays or pay schedule
  • Payroll deductions
  • Holidays
  • Vacations and/or paid time off
  • Leave, including disability, personal, bereavement, family and medical leave, jury duty, pregnancy, and military leave
  • Insurance benefits, including health, vision, dental, life, and unemployment
  • Retirement plans
  • Training or education programs
  • EAP services

Company Procedures

  • Steps/process to file complaints
  • Emergency procedures
  • Any discipline procedures or performance improvement plans
  • Process for employees exiting the company

The final piece of the handbook will typically be an employee acknowledgement page.

Creating an Effective Employee Handbook

Your employee handbook will not necessarily need to include all of this information listed above, and it might include other information that is not noted here. Pairing your own experience and knowledge with the input of relevant stakeholders and/or a corporate compliance team can help you determine what is needed for your employee handbook.

Whether you are writing a new employee handbook or updating your current one, here are some steps that you can take to make the process go more smoothly:1

  1. Decide on what to include in your handbook or what needs to be added, removed, or updated
  2. Create an outline to ensure the order of the elements to be included flows in a logical manner
  3. Summarize each policy and procedure to ensure readability by an audience that is not well-versed in legal jargon
  4. Flesh out the outline with your summaries
  5. Review the entire document and circulate it for review to the appropriate parties
  6. Finalize the review process be giving a copy to your legal counsel and make updates accordingly
  7. Distribute the handbook to employees in a manner that makes the most sense for your company (ex. paper copies or digital)
  8. Update the document as needed or set regular periods for you to review it

The review steps should ensure that your handbook is legally compliant and that it accurately reflects your company culture. In the review stages, you should also ask any reviewers to check for readability and accessibility. Is the document easy to understand? Is it organized well? Taking the time to iron out any wrinkles before distributing the handbook will be worth your time.

Updating and Maintaining an Employee Handbook

Let’s go a little deeper on the last step of the process. Regularly reviewing and updating your employee handbook is essential to make sure you are keeping up with HR law. As you know, laws and regulations are always changing, so you will want to keep an eye on the handbook to maintain compliance. Setting a schedule at regular intervals (yearly, quarterly, etc.) may be a good idea so that it does not fall off your radar.

To make sure your handbook is relevant, you will want to get your employees involved. Getting input from employees is a great way to get a diverse perspective on your document, and can enhance engagement. While new employees may not be quick to share any criticism of the document, it might still be worth asking them if any areas of the handbook were not clear upon their initial review. More long-term employees can provide especially valuable feedback as they are living the company culture and will be able to see what edits or additions can be made to the handbook.

Build a Strong, Compliant Workplace Culture With Pitt Law

The law influences almost every professional decision for employees working in HR. Understanding HR law when creating documents like the employee handbook makes you a vital part of your company.

Pitt Law’s Online Master of Studies in Law (MSL) program is here to help those without a JD degree learn what they need to get ahead. Set yourself apart as a leader in HR with in-demand legal knowledge and skills. Small class sizes and individualized attention will set you up for success during your master’s program and after graduation. Completing the Human Resources Law specialization enables you to be eligible to sit for the Human Resources Certification Institute (HRCI) and Society for Human Resource Management (SHRM) exams within one year of graduation.

As you prepare to apply for Pitt Law’s Online Master of Studies in Law (MSL) program or one of our graduate certificate programs (also offered online), know that our admissions advisors are always on standby to answer your questions, clarify admissions requirements, and review the list of materials we need from you. Schedule a call today.