Many employers have employee handbooks that are disseminated to new employees at the time of hire. However, with the dynamic nature of the laws affecting employers, it’s important to routinely audit your handbook to ensure compliance with state and federal laws.
But you may choose not to update your handbook for the following reasons.
10. You enjoy being sued for breach of contract
In almost every state, employment is “at will”, meaning the employee may quit at any time and, likewise, the employer may fire the employee at any time for any lawful reason. The “at-will” status, however, can be modified by an employment contract – express in a written agreement or implied by conduct and actions. Poorly drafted employee handbooks can create either implied or express contracts with employees, thereby bringing a host of additional issues should you need to take any adverse employment actions against an employee.
Thus, if you don’t enjoy defending against breach of contract claims, be sure your employee handbook contains a clear and conspicuous disclaimer expressly stating that the handbook “is not intended to create a contract of employment between the company and any of its employees or otherwise alter or modify employees’ at-will status.”
Avoid using such terms as “probationary” and “permanent” in the handbook to define employment status because these words have been found to modify the at-will status. You should also avoid language that appears to make promises to employees that you may not keep or to infer that an employee can only be terminated “for cause”. For example, rather than referring to “regular performance evaluations,” your handbook should use more flexible language, such as, “We strive to evaluate each employee periodically.” Such language gives you flexibility in the event you inadvertently fail to adhere to your own policies.
9. You want to keep your employees guessing
A well-written handbook should contain a section with the rules, regulations, and procedures that you expect your employees to obey. The rules section should discuss your disciplinary procedures but permit you to exercise discretion, flexibility, and judgment on a case-by-case basis. Having said that, keep in mind that using a heavy hand with one employee and letting another one off the hook for a similar offense could give rise to discrimination and/or retaliation claims.
Some other areas that warrant mention in the rules section include wage and hour compliance, attendance, and leave policies. Specifically, the “workweek” should be defined, and policies pertaining to overtime pay , meals and breaks should be clearly outlined. You should also discuss your pay periods, paydays, direct deposit options, timekeeping policies, and authorization to work overtime.
8. You want to give employees a chance to plead ignorance
In today’s litigious climate, it’s important to have all bases covered and to ensure that there are no loopholes in which a litigant can escape accountability for failing to adhere to your policies. If your handbook does not include an acknowledgment signed by the employee upon receipt of the Handbook stating that they have received it and understand it is their obligation to read and understand the policies, then the employee (through their attorney) will have a chance to claim they never received a copy of the handbook and therefore did not know the rules, regulations, policies and procedures..
In addition to the “received and understand” phrase, the acknowledgment should state that the employee acknowledges that the handbook does not create a contract of employment, that employment status is at will, and that employment can be terminated at any time for any lawful reason, with or without prior notice
The acknowledgment should be contained on a separate page from the rest of the handbook and should be maintained in each employee’s personnel file.
7. You prefer to have questions regarding Leaves of Absences determined in litigation
If your company is covered by the Family and Medical Leave Act (FMLA), and the California Family Rights Act (CFRA) your handbook must explain your FMLA/CFRA-related policies. It would be beneficial to include the statutory requirements for an employee to be eligible for leave (worked for you for 12 months, etc.) along with eligible employees’ rights and responsibilities under the Act.
This section should carefully explain whether your require employees to exhaust their vacation and sick time before taking unpaid FMLA leave is taken. You also should explain the employees’ notice requirements (30 days in advance if foreseeable) as well as requirements to produce certification of the medical condition from a health care provider.
Even if the company is not covered by FMLA/CFRA there are numerous other leave laws in California which provide employees a legally entitled right to take time off and possibly have their jobs held open for them. The rules, policies and procedures for requesting, taking and returning from leaves should be detailed in the Handbook.
6. You prefer to keep employee benefits a ‘surprise’ to employees
Although some employees would be pleasantly surprised to find out about their benefits “after the fact,” the Company is probably better served by letting them know up front “what’s in it for them.” The Handbook should discuss the vacation policies, including payment of unused vacation time upon separation. Paid holidays, sick time, personal days, and bereavement leave should also be detailed.
As for health insurance and retirement plans, it’s best to mention their availability but defer to the carriers’ plans and policies to maintain your flexibility.
5. You’d rather have flexibility and determine the disciplinary policies as you go
Although making up the policies “as you go along” would permit a great deal of flexibility, it would very likely generate claims of unlawful discrimination and/or retaliation that could be difficult to disprove. Therefore, it’s in your best interests to include the details of the disciplinary process in the personnel handbook.
Having said that, it’s also important to avoid being all- inclusive and inflexible. The policy should be crafted to maintain the ability to exercise discretion and judgment depending on the severity of the circumstances. Additionally, the policies should avoid terminology such as “good cause” and “just cause” because such language could imply modification of the at-will status.
4. You don’t care if employees waste time and resources – its fun to “surf” the Internet, Tweet, and post on FaceBook for hours
With the technological changes that have taken place over the last decade, many employers recognize a need to monitor their employees’ use of computers, Internet access, and their “smart” phones. Although state and federal laws place some restrictions employer monitoring such activities, if the employee is put on notice of such monitoring then employers can maintain some control.
3. Only Other Companies Get Sued for Harassment, Discrimination and Retaliation – it won’t happen here !
More and more businesses, large and small, in California face some type of employment litigation at least once in the life of the business. These claims are not limited to just sexual harassment – claims of discrimination and harassment may be based on race, religion, disability, sex, gender, or any other category protected by law. Employees are also suing for “retaliation” more than ever before claiming that they have been “retaliated” again in some manner following their lawful workplace conduct – such as claiming that they have not been provided their meals and breaks and then they are “laid off”.
Every handbook should contain an explicit policy which clearly and unambiguously details the policy prohibiting harassment, discrimination and retaliation and should contain definitions of prohibited conduct along with examples of such conduct. The policy should also include a statement that any employee who engages in harassment, discrimination or retaliation is subject to immediate discipline, up to and including termination.
Diligently training managers and supervisors, and monitoring employment practices, are also critical to avoid or defend claims.
The presence of a clear and detailed statement against harassment, discrimination and retaliation sends a clear message to employees (and hopefully not , but a jury) that the company is committed to a workplace that does not tolerate such conduct. Although most employers post such policies, having the policy in the handbook serves to reinforce it and emphasize its seriousness.
2. Substance abuse in the workplace doesn’t concern you
If substance abuse in the workplace is a concern, a policy addressing substance abuse policy and drug testing should bed included din the handbook. The rules on drug testing at work are complex and any failure to conform can lead to litigation and liability.
1. Employees Can Take Their Meals and Breaks Whenever They Want – We Don’t Have to Regulate Them.
Wage and Hour lawsuits filed by employees claiming that they did not get a meal break, or they had to work through their meal break or that the meal break was “late” are being filed every day in California. Employees can also claim that they were denied the right to take either or both of the rest breaks. A clearly stated policy in the handbook setting forth the rules on meals and rest breaks, and on employee time records, can help defend against these claims. Without stated policies, and without accurate time records, these claims are difficult to defend, and can be so costly that the penalties and attorneys fees can destroy the business.
* Bottom line *
Obviously, avoiding litigation, administrative charges, and internal complaints is critical and so the first line of defense is a properly draft employee handbook that is implemented and followed. Because of the constant changes in the laws affecting employers, it’s important to regularly review and audit your policies and procedures to ensure compliance with state and federal law.