7 Tips for Creating an Employee Handbook

Is your small business growing? If so, it may be time to codify some workplace rules. Creating an employee handbook doesn’t ensure compliance, of course, but it can help to put everyone on the same page and also protect a small business owner from certain liabilities.

Here are seven tips for creating an employee handbook.

1. Forget the jargon. Filling an employee handbook with legal terminology and oodles of fine print is no guarantee you’ll avoid disputes with your employees. That’s because labor law is complex: It’s impossible for a handbook to include verbiage that covers every potential legal issue that could arise. The point is to communicate, not legislate. Strive for succinctness and clarity.

2. Write with a casual voice. Use a conversational tone, says Allen Price, CEO of First Third Sustainable Human Capital Consulting. For example, replace the word “management” with “we,” which adds a note of informality. In addition, offer examples that illustrate the standard of conduct you expect. Price addresses these and other issues in a blog post titled “Why Your Employee Handbook Stinks (and How to Fix It).”

3. Avoid Orwellian rules. Barbara Wanless of Eagle’s Flight, which specializes in experiential training, warns against stuffing handbooks with ridiculous rules such as “no whispering.” When a handbook has more pages than the company’s operational manual, workplace morale plummets, she says.

4. Define boundaries. Paul Downs, founder of Paul Downs Cabinetmakers, says he defined the boundaries between his company and his employees early on. He drafted a set of workplace rules and asked his attorney to vet them. New employees sign a receipt stating they’ve received a copy, and if the rules are later amended, the new version is distributed to everyone, he explains in this New York Times blog post. Downs notes that enforcing handbook rules in a small business “defends the integrity” of those who willingly comply.

5. Include standards for digital conduct. Remember to address digital security issues for employees who work on-site and remotely. Decide who should have access to the company’s passwords, and describe the proper procedures for posting online content on behalf of the company, as well. Personal use of a company’s internet service has landed more than one employer in hot water. Be sure to include company rules for surfing the web while on the job, and what can be said on behalf of the company on the web.

6. Illustrate ethical quandaries. Your handbook should include a section on ethics. Offer a few narratives to help employees reflect on ethical issues, using illustrations that pertain to your business. For instance, Kathleen Edmond, Best Buy’s chief ethics officer, gives the real-life example of an employee who skirted the company’s gifts policy. She then posed a series of questions to help employees understand the difference between ethical choices and criminal wrongdoing.

7. Be fair and consistent. Jason Fried, co-founder of 37signals, says a firm’s culture is shaped more by “consistent behavior” on the part of management than by the implementation of long lists of rules. Be fair, consistent, and clear in your expectations of employees. Draft your handbook with that mind and it will help you avoid problems and misunderstandings.

About Jan Fletcher

Jan Fletcher, President of Dreamcatch Creative, reports on restaurant operations, the signage industry, and composite manufacturing. She also writes about technology in business and education, and is passionate about microenterprise.
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2 comments
ucdavisexeced
ucdavisexeced

@Leadershipfreak @SmartBrief This is a great resource! Thanks for sharing

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  1. [...] or family-oriented principles. But even small companies need basic policies and procedures. Create an employee manual or handbook. Require employees to sign a document acknowledging that they’ve read and understood [...]

  2. [...] or family-oriented principles. But even small companies need basic policies and procedures. Create an employee manual or handbook. Require employees to sign a document acknowledging that they’ve read and understood [...]