Posted in HR

The Number One Mistake Small Businesses Make in Their Employee Handbook

You’ve finally drafted your employee handbook, with all its policies and company vision statements wrapped inside. Congrats! That means you can finally cross it off your to-do list.

But wait — there’s a trap! Some policies depend entirely on where your business calls home: Many hot topics, such as leave and PTO, have state and local requirements that you can’t get wrong. The number one mistake people make when polishing up their handbook? Not making their policies locally up-to-code. 

The best way to avoid this mistake is to have a local lawyer or HR expert read and approve your handbook. To get you started, here’s a list of policies that you’ll definitely want your local HR authority to review.

Policies that often have local regulations

To avoid awkward mistakes, keep a close eye on how your state handles the following policies:

  • Family and medical leave: Federal FMLA leave is all fine and dandy, but your state might require you to offer more.
  • Paying out unused vacation time: This one is important. Some employers allow people to borrow vacation days even if they haven’t accrued them yet. And that’s just the start. Some states require that vacation is paid out at termination, regardless of what an employer’s policy says.
  • The final paycheck: When you’re dealing with the tumult of an employee leaving, you may also have to cut them a paycheck. Similar to vacation time, the state you’re in may have its own laws to ensure people get paid quickly and fairly.
  • Short-term disability: Some states require you to provide this. Others don’t.
  • Employee file access: Do employees have the right to see their personal personnel files? Your state makes the final call.
  • Jury duty leave: Your team shouldn’t have to worry that their job might be in jeopardy if they get called for jury duty—and states agree. Some even require employers to pay employees for a portion of the time spent being a good citizen.

Federal policies to double check

Make sure your legal or HR counsel also covers these high-risk federal policies, which should be observed in every state:

  • At-will employment: At-will employment means either the employer or the employee can end their employment relationship at any time. This type of employment is assumed, unless there’s an agreement clearly stated, in every state except Montana.
  • Equal employment opportunity statement: An equal employment opportunity statement (or anti-discrimination policy) isn’t just part of your organization’s values; federal law prohibits discrimination based on “protected classes,” such as sex, nationality, religion, age, disability, sexual orientation, gender identity, and pregnancy.
  • Anti-harassment policy: Everyone’s civil rights are protected, and employees are protected from discrimination based on classes such as age, disability, or sex. But, despite their potential impact on morale, not everything is actually illegal. To be unlawful, harassment must “create an environment that would be intimidating, hostile, or offensive to reasonable people,” according to the Equal Employment Opportunity Commission (EEOC).
  • Safety and security policies: As an employer, you’re required to comply with Occupational Safety and Health Administration (OSHA) requirements and you’ll likely need to rely on employees to stay safe and compliant. Make sure they’re well aware of any procedures and protocols needed for prevention, treatment, or reporting by detailing them in your employee handbook.
  • Drug-free Workplace policy (…maybe): You may be required to have a drug-free workplace policy in place, especially if you’re a federal contractor or recipient of federal grants.

For any of these policies, your first stop for the latest info should be your state’s website. That’s where you’ll find any relevant legislation, and maybe even services to help you navigate the more sensitive points.