In this Newsletter: Reducing Liability and Increasing Productivity Through Your Handbook
Your Employee Handbook may be your best opportunity for creating the early expectations that will decrease your risk of liability and increase employee engagement.
In this Newsletter, you will find the following tips and tools for your Sustainable Employee Handbook:
Remember: Every workplace is unique, and what works at the Company next door may not work for your Company. The policies we recommend here (and that we recommend against) must be considered in the context of your unique workplace.
In our next issue, we will continue our focus on onboarding employees with How to Protect Your Confidential Information Through Your New Hire Practices. If you would like to see prior Newsletters, click here.
Employees want to know what is expected of them and how they are performing against these expectations. Your Employee Handbook is an opportunity to share that information. A well-drafted handbook, if it is enforced, also can provide protection against liability. Here are ten topics we consider "must haves:"
1. Define the Purpose and Use of the Handbook. The Handbook is not a contract guaranteeing employment of a specified period (i.e., does not promise that employees only may be terminated for good cause.) However, it is a contract because compliance with the policies is a term and condition of employment, and employees will be held accountable for conduct inconsistent with the policies set forth in the Handbook. The Company should reserve the right to modify all but the at-will policy at its sole discretion.
2. Demonstrate and Require a Commitment to Equal Employment Opportunity. In California, the list of protected categories is long. You have a legal obligation, which you should acknowledge in writing, to make your employment decisions without unlawful consideration of an employee's status in a protected group. Click here to see protected categories in California.
3. Prohibit Sexual and Other Harassment, and Provide a System for Complaint. As a "best practice," we want employees to understand their right to a workplace free of harassment and to understand what is and what is not a hostile work environment. What we don't know, we can't resolve, and what we don't try to resolve, we may need to defend in court. Additionally, California law requires that employers provide employees with notice of prohibited sexual harassment (larger employers are required to train managers on this subject at least every two years). Equally important, a well-drafted and consistently applied policy against harassment can help you defend against a claim for failure to prevent harassment and, where employees fail to take advantage of the opportunity to complain under the policy, may offer an affirmative defense that, in California, may reduce potential damages. Click here to see some key elements for this policy.
4. Prohibit Disability Discrimination and Outline Reasonable Accommodation. This policy should outline the Company's commitment to equal opportunity. Employees who require accommodation should be required to alert the Company. This places responsibility on the employee to make the request, and may protect the Company from a perceived disability claim.
5. Reaffirm the At-Will Presumption. California law presumes that the employment relationship is at-will. Employers should remind employees that an employee is free to resign at any time, with or without notice or cause, and that the Company also may terminate the employment relationship at any time, with or without notice or cause, for any reason that is not in violation of applicable law. Remember to also reserve the right to change the terms and conditions of employment, including job duties, location, compensation and benefits at any time with or without notice, and with or without cause, in the Company's sole discretion.
6. Include, Understand and Enforce Wage and Hour Obligations. An employer's failure to comply with its wage and hour obligations can be a costly mistake, and many lawsuits arise from an employer's failure to mandate and enforce wage and hour policies. For a list of some key policy components click here.
7. Outline Available Unpaid Leaves of Absence, and Their Impact on Employment. Some leave policies, like pregnancy disability leave and family and medical leave (where applicable), must be detailed in writing to employees. Providing information on other available leaves is a good idea so employees understand when they may and may not be absent. A list of potential leave policies is attached here. In future Newsletters, we will cover the terms and conditions of these leaves in detail. We cannot emphasize enough: understand and share with employees what you are and are not required to offer in the way of leave and benefits.
8. Prohibit the Use of Illegal Drugs and Alcohol in the Workplace. You should include the right to test a current employee in the event you have reasonable suspicion they are under the influence of illegal drugs or alcohol. You may not test current employees absent reasonable suspicion. Further, if you do not include the right to test in your policy, you may not test. Include that use of prescription medications may not create an unsafe workplace or otherwise violate the law. As with all policies, be true to your own workplace; if you have Company parties with alcohol, include a carve out. Remember, employees who disclose to you an addiction to drugs or alcohol (before they are determined to be in violation of your policy) may be entitled to a leave of absence for treatment.
9. Describe Appropriate and Inappropriate Use of Company Systems. Remind employees that all communication systems belong to the Company, and that the employees have no reasonable expectation of privacy when they use Company computer and phone systems, even when that use is for a personal purpose. Be clear about what employees may and may not do on your systems, and whether they may do so during working hours or while on breaks. We will talk about use of Company systems more in future Newsletters.
10. Require that employees acknowledge receipt of and opportunity to review the employee handbook. Not only does this provide another opportunity to communicate your expectations, it provides an opportunity for you and the employee to confirm the Company's commitment to at-will employment.
We had a hard time limiting the above list to ten! Here is a link to some additional topics you May Want to include in your Sustainable Handbook.
We may spark lively debate with this one! Here are our thoughts on some "standard" policies you may not want to include.
1. Eliminate the "Introductory Period." No matter the "caveat" language you include about how successful completion of an introductory period does not make employment secure, the presence of this policy contradicts that statement. If you want to deny or limit benefits until an employee shows her mettle, that's fine. Do so in the benefit policies or Plans themselves. An employee is at-will on day 1 and day 91, and you do not want any policy suggesting otherwise.
2. Do Not Include Health or Other Benefit Plans in Your Handbook. Your benefit plans (like health or other insurance benefits, 401k or other savings plans) are described in the Plan documents themselves. Even if you include language in the handbook that allows you to modify all Plans and benefits, if you change the Plans and do not change your Handbook, the two will be in conflict and may create confusion. Let the Plans speak for themselves.
3. Do Not Promise Progressive Discipline. As we will emphasize in a future Newsletter, where possible and practical you will want to provide employees with warning and opportunity to improve. Having said that, you do not want to promise that you will give that opportunity. To do otherwise could contradict your at-will policy, no matter the caveats you include.
4. Reconsider a Separate "Standards of Conduct" Policy. In certain industries, a stand-alone checklist of terminable offenses may be necessary. For other workplaces, a policy that calls out certain policies as terminable offenses (particularly where those policies already are described as conditions of employment elsewhere in the handbook) (1) contradicts your at-will policy (by suggesting you need a reason for termination); and (2) suggests that the Company will not terminate employment for violation of a policy not on the standards of conduct list. You want your handbook to say "we may terminate for any or no reason, and no one policy is more important than another."
5. Delete the Following Language From Any Policy Other Than Sexual Harassment: "Violation of this policy may result in discpline up to and including termination." In fact, violation of any policy (or no policy), and not just some policies, may result in termination. To suggest otherwise contradicts your at-will policy. Additionally, like the Standards of Conduct, including this language in some but not all policies suggests that violation of only certain policies may result in termination of employment, whereas in fact violating any (or no) policy could have that result.
6. Do Not Require That Employees Give (Or Receive) Notice Prior to Termination. In an at-will relationship, an employee need not give and is not entitled to receive notice prior to termination of employment. At best, request but do not require that employees provide a short period of notice if they resign. And consider not requiring any notice: realize that if you request that an employee provides notice, you are required to honor the notice period they provide or you risk converting their resignation to a termination.
7. Less is More. There cannot be a policy for every behavior you want or that you want to discourage. Common sense and good judgment remain the key behaviors you should require of any employee. For example, do you really need a written policy to prohibit an employee from dressing in their pajamas before you can take action on that conduct?
8. Delete any Policy That Does Not Reflect Your Actual Workplace Requirements. If a policy doesn't apply to your workplace, don't include it. The presence of policies that do not apply undermines the policies that matter to you.
Read through this short story, and take our quick quiz.
Dominick frequently returns from lunch late and in a surly mood. He chain chews gum until it is time to go home. He has been observed napping in his office. He is rude to his co-workers, and talks back to his manager. This goes on for at least a year, and nothing is done. On a Friday at 1:30 p.m., one of Dominick's co-workers reports to you that she smells alcohol on his breath. Your policy allows for reasonable suspicion testing. What should you do?
What if the co-worker tells you about Dominick's breath when she comes in on Monday?
You decide to meet with Dominick to confront him with the behavior and the breath. Before you get very far, Dominick confesses that he has an alcohol addiction, and requests time off.
Quick Quiz: Dominick and the Drink
1. Assuming the co-worker reports Dominick on Friday, may the Company lawfully send Dominick for an alcohol screening?
2. What if she reports the conduct on Monday?
3. Is Dominick entitled to a leave of absence based on what you know?
4. What claims could Dominick raise if the Company decides to terminate him?
5. What is the real lesson learned here?
To see our thoughts and recommendations, click here.
Above are some tools for creating your own Sustainable Employee Handbook.
If you would like additional help, we offer the following resources:
1. The Sustainable Handbook Review. If you want to be certain your handbook is protecting you from unwanted liability, and not creating unforeseen headaches, we are happy to review your existing handbook.
2. Creating the Sustainable Handbook. We have a handbook creation process through which you identify your Company's key values, needs and wants, and we work with you to create an Employee Handbook unique to your workplace.
Keep an eye out for next month's newsletter for additional tips on creating the Sustainable Onboarding Process: Confidentiality Policies, Practices and Agreements for New Hires to Protect Your Company's Assets and Reduce Liability.
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