Employee handbooks can be useful tools, and employers should be careful in crafting them to suit their business and legal needs.
Of course, not every handbook is perfect, and many contain issues that may seem minor but could have significant ramifications.
The following are some of the more common problems with handbooks that employers should consider:
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1. The handbook is not easily understandable
Although commonly written by attorneys, handbooks should not read as if they were.
A handbook that cannot be understood by an average employee is of limited use. For example, many defenses in harassment claims hinge on whether the employer has a reasonable reporting mechanism (more on that later) to notify the employer of workplace issues.
If an avenue to report inappropriate conduct is incomprehensible, courts are unlikely to consider the reporting mechanism to be reasonable, thus making the employer's defense substantially more difficult.
A handbook should be written in plain language.
2. The handbook does not contain a reporting mechanism
Reasonable reporting mechanisms are not just important for an employer's defense to a harassment claim (as previously discussed), but for other claims as well.
Whether an employee wants to request leave or an accommodation, employers need to provide a reasonable avenue to do so (i.e., providing a phone number or email address for human resources).
If these mechanisms do not exist, the employer increases its risk of liability under, for example, the Family and Medical Leave Act and Americans with Disabilities Act, among other statutes.
3. The disciplinary policy is too rigid
Progressive disciplinary policies are fairly common, but many employers neglect to include a provision that any step in the progressive disciplinary process may be skipped if the offense is sufficiently severe.
Without the discretion to skip a step, employers may encounter a situation in which an employee has committed his first offense, but his conduct was truly beyond the pale and should warrant the termination of his employment.
By including a more flexible disciplinary process, employers can be allowed more leeway in assessing proper discipline while simultaneously minimizing any claims of unfair treatment.
4. The handbook firmly limits employee leave
Courts can be less than agreeable to employers strictly limiting the amount of employee leave.
For example, although the FMLA provides up to twelve weeks of unpaid leave per year for serious health conditions, employers also need to consider the implications of the ADA, which requires that the employer offer a "reasonable accommodation."
In some situations, providing additional leave can constitute a reasonable accommodation under the ADA, and definitively barring any leave beyond a set number of days or weeks can run afoul of the statute.
5. The handbook prohibits discussion of employment benefits
An employer's inclination to limit sensitive workplace conversations may be understandable, but employers cannot include provisions in their handbook which prohibit employees from discussing the terms and conditions of their employment, including compensation.
The National Labor Relations Act specifically protects these conversations as "concerted activity."
If an employer's handbook contains a prohibition on these types of discussions, it can be a quick path to liability under the NLRA.
6. The handbook does not have state-specific provisions
Many employers do not include state-specific employment law provisions into their handbooks.
Relying solely on federal laws, particularly with respect to anti-discrimination laws, can be perilous.
Some states protect a number of characteristics that are not federally protected. For example, Illinois law prohibits discrimination based on arrest records, whereas federal law may not.
To minimize risk, employers need to be aware of the state-specific laws that impact their worksites and incorporate them into their handbooks accordingly.
7. The handbook does not contain a drug testing policy
Employers should provide guidance as to what circumstances may lead to employees being tested for drugs or alcohol.
The Occupational Safety and Health Act provides limits on drug testing. In addition, state law variants of OSHA can be more cumbersome, requiring confirmatory retests and limiting discipline in situations where the employee has voluntarily undergone substance abuse treatment, among other things.
Moreover, the penalties for failing to comply with OSHA and its state counterparts can be substantial, and being aware of the appropriate circumstances for drug testing (and possible disciplinary action) is crucial.
In addition, testing may raise issues under the state common law or applicable privacy statutes.
8. The handbook does not contain any disclaimers
Many employees are at-will, meaning that they can be terminated for any reason at any time as long as it is not unlawful.
In light of this fact, employers should be careful to include disclaimers in their handbooks stating that any language contained in the handbook does not create a contract and is not intended to alter the at-will relationship.
If a handbook does not contain this disclaimer, there is a greater likelihood that an employee may be able to enforce the handbook as a contract and challenge a possible termination.
9. The employee did not sign an acknowledgment
Handbooks should contain an acknowledgment of receipt for an employee to sign and date.
Evidence that an employee is aware of his employer's reasonable reporting mechanisms, among other things, cannot be understated.
Several defenses in employment litigation rely on an employee's knowledge of an employer's policies. Simply put, an employer is in a far better position if an employee signs an acknowledgment page each time the employer updates its handbook.
10. The handbook is stale
Handbooks are not evergreen.
Employers oftentimes will allow their handbooks to become outdated because the applicable law has changed.
To avoid this, and other potential pitfalls, employers should regularly consult with counsel as to any relevant changes in the legal landscape.
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