What is an employee handbook and how do I create one

Everything business owners should know about employee manuals

Employee handbooks set the tone of the company’s values, business expectations and the overall work environment from the very start of onboarding for new employees. In fact, employee handbooks are often the first way that new hires interact with the organization as a full-time member of the team. As such, employee handbooks should act as living documents that provide details on everything from remote work to the core values of your business. Writing, building and creating an employee handbook is a huge undertaking. This article will outline why employee manuals are important and what to include in yours as you get started.

What is an employee handbook?

An employee handbook is a document that outlines business expectations, company policies, employee benefits, the foundations for the employment relationship, employment policies, and any information pertinent to being a part of your organization. Some employees may be aware of this information if they have an employment contract in place, however, the manual serves as a tool for ongoing reference for employees. The handbook often includes a signature page that employees can sign, indicating they agree to the terms of the handbook. Without a handbook, it can be difficult for employees and new hires to know what to expect. An effective employee handbook is clear, organized, has a table of contents, and covers all topics pertinent to the small business.

Why is an employee handbook important?

Providing an employee handbook sets the employment relationship on the right track. Moreover, it protects the employer in that all policies, laws and regulations have been disclosed to the employee should there be a disagreement that takes place in the future. There are three other important reasons why an employee handbook at your business is important:

• Promote professionalism. Providing a document that outlines the company’s mission, values and expectations sets the tone for what the employee can expect with their position at your organization. Similar to how customers experience your brand, your employees will begin to experience what your company stands for. This supports efforts by human resources to make sure the employee is informed and understands all aspects of their role at your business.
• Set standards. A manual that covers expectations for all employees shows that every employee is held to the same standards. Also, when the policies and rules are clearly defined, employees have a clear sense of how they might address questions or concerns while on the job. You are encouraging a culture of transparency and openness by making sure all areas of your business are addressed when you bring on a new team member.
• Maintain company culture. Having a document that dictates the precise language associated with your organization strengthens your value and purpose as a business. Employees will learn what is important to your business, and how they fit into the larger picture. When a new hire reads the manual on the first day, they are getting a sneak peak at what your business is like, how you operate, and what they can expect moving forward.

What should my employee handbook include?

There are many templates available for writing an employee handbook. Of course, determining which topics and what details to provide are at the discretion of the organization. However, below are some ideas of sections to include so that your employee has the most up-to-date information possible.

• Mission statement. Your mission statement should be included at the very beginning of your employee manual. With the mission statement, you should include values and objectives of your business as well. This will help ensure that new hires fit within this scope of work and that there is alignment with goals and strengths. Ultimately, your mission statement sets the foundation of your business operations, so it’s important that all employees keep this in mind as they move forward with their responsibilities. You may also include disclosures related to how your company provides equal employment opportunities.
• Code of conduct. Rules are a common part of employee manuals, especially as they relate to day-to-day expectations. It is critical that your employee manual addresses code of conduct expectations, as this is a way to communicate what your business expects out of all company employees, regardless of position. Specific rules that are common to include within the code of conduct aredress code, non-discrimination policies, anti sexual harassment policies, boundaries with employee relationships, disclaimers related to conflict of interest, limits with social media and technology, and any limitations with work hours. This section of the handbook could also indicate any policies around at-will employment that your company may have with contracts and positions.
• Employment information. Employees are often very concerned with compensation, paid time off (PTO), and other aspects of their workload. This section is a great part of the manual to include any information employees may need about their employment. Topics can include payroll and compensation schedules, information that human resources may need, overtime policies, performance review schedules, termination policies, work schedules, non-exempt employee information, processes with jury duty, vacation time, and leave policies (such as sick leave or information related to the medical leave act). It may be useful to also address any topics related to employment law in this section.
• Benefits. The benefits section of your company handbook may be supported by members of your HR team. You will want to include information about eligibility for benefits, such as health insurance. This section can also outline other aspects of benefits, including workers’ compensation, perks, reimbursement, and retirement plans.
• Disciplinary procedures. This section can be at the end or be included with the code of conduct section. To protect your company, you should outline the process of what happens when an employee violates the aforementioned code of conduct. A written disciplinary procedure helps dictate the process so that there is clarity for all parties when disciplinary action needs to take place. This is crucial so that all employees are treated fairly in these instances.

How do I write an employee handbook?

Below is a step-by-step guide of how to write a company handbook for new hires, as well as existing employees. As you begin this process it is necessary to take your time, use clear language, build a framework for the information, and ensure accessibility of information for all employees. As you create this content, it may be worth designating a time to review the handbook quarterly or bi-annually so that employees are always getting the most relevant and up-to-date information about your organization. Here is how you can get started:

• Review existing policies. If you have established policies, you should audit what you have and make sure it aligns with current expectations with policies. If you have some policies, but need to add more, this is a good time to build a framework and find what gaps exist.
• Outline your new handbook. As you identify policies that should be created, you can also create an outline of what sections to include in your handbook. A great employee handbook covers all topics of interest (and thus is detailed) but is also easy to navigate and explore. You may want to add in sections about state laws and federal laws that are relevant to your business as well.
• Break it into small chunks. Write, update and refine one section at a time. You can review policies with relevant parties (like the executive team or human resources) to make sure your team is on the same page. As you finish a section, you can move to the next until you have a working draft for all expectations, policies and disclosures.
• Review your draft. Once you have a working document, it is important to run it by several parties to make sure you did not miss anything. It is recommended that you provide a draft to your legal counsel for review before making any finalizations to the handbook.
• Distribute. Make plenty of copies (if using a hard copy) or create a PDF version for digital access. A PDF will ensure that no one can make changes to the document once it is finalized. You will want to consider how this information is shared (and when) and to offer discussions on any questions or concerns that employees might have along the way.
• Update. Based on your set frequency for review, make sure your team reviews the handbook at this time. This will make sure you consider any changes to policies as well as new issues or sections that may arise.

Setting your business up for success

An employee handbook can go a long way in helping your business be set up for success from the very start of a new hire's interactions with your business. You can see a company manual as setting a solid foundation with your team so they can transition smoother and more efficiently into their work. A great employee handbook will speak to questions that any employee could have, whether part-time or full-time, ensuring they have a full understanding of what working at your company entails.

When you are ready to begin, you can look for employee handbook templates that best suit your business needs. You can customize your handbook to be as detailed, creative and informative as you like. More importantly, your handbook will be flexible and living, allowing new innovations to be absorbed on a regular basis.

Next steps

Are you ready to build your company handbook? Are you ready to organize and outline all expectations and policies at your business?

Heartland is ready to help.

Heartland helps nearly 1,000,000 entrepreneurs make and move money, manage employees and engage customers with human-centered technology solutions that allow them to rise above the daily grind and lead their businesses into a brighter future. Learn more at heartland.us