5 must-have workplace policies for your employee handbook

Published: April 2, 2024

Employee handbooks, which contain important workplace policies, are a key resource that can protect the organization, its assets and its people. Employers often use employee handbooks to encourage consistent practices in the workplace and ensure compliance with various laws.

But employee handbooks can do much more. Employers can a use them to showcase employee benefits, promote the organization’s values, and create excellent employee experience.

Unfortunately, not every employer gets their employee handbook right. Often, an organization is missing key workplace policies that are fundamental to any handbook. To help combat this problem, below are five key workplace policies to include in your employee handbook.

1. Employment at-will policy

An employee handbook should include an at-will policy. An effective at-will policy leaves no doubt that the employment relationship is at-will. This means it can be terminated by either the employer or the employee at any time and for any reason unless there is a written agreement or a law saying otherwise (e.g., a law prohibiting discrimination on the basis of race, gender, etc.). The employment relationship is presumed to be at-will in all states except Montana.

Creating a clearly written at-will policy that expressly says that any modification to the at-will status of the employment relationship may only be made in writing by a specific company representative (e.g., the CEO) can provide you with a valuable defense in response to employees’ breach of contract claims.

To convey its importance, consider bolding the at-will policy language and placing it on the first page of your employee handbook.

Also, avoid statements in the handbook that are inconsistent with at-will status. For example, references to permanent positions or statements that employees will be rewarded with job security for good performance or loyalty.

2. Workplace policies required by law

Handbooks are not legally required, so you generally have flexibility in what’s included in the employee handbook contents. However, certain laws require that employers include certain employee policies in the employee handbook if they choose to have one.

For example, employers covered under Maryland’s Reasonable Accommodations for Disabilities Due to Pregnancy Act must include a section in any employee handbook concerning an employee’s right to reasonable accommodations and leave for a pregnancy-related disability.

Some laws go further, requiring either the following:

• Specific language to be included in a handbook policy.
• Distribution of the policy to employees at a specific time.

Not including required language or failing to timely notify employees of their rights under these laws is a clear compliance risk to avoid. To prevent any missteps, be on the lookout for these provisions when tracking legal developments.

3. Equal employment opportunity and harassment policy

Including policies that demonstrate your commitment to providing equal opportunity employment (EEO) and prohibiting unlawful discrimination and harassment is paramount. It will go a long way toward fostering a positive working environment and increasing employee engagement and morale. It will also help improve your organization’s brand and reputation, which may help attract a more qualified applicant pool and improve employee retention.

Protected characteristics

When drafting your EEO discrimination and harassment policies, be sure to account for any protected characteristics that are covered under federal, state or local laws. Also consider including characteristics that go beyond the law. This will demonstrate that you foster a diverse, equitable and inclusive workforce.

Prohibited behaviors

To provide context for employees, include a non-exclusive list of the types of discriminatory and harassing behaviors or conduct that are prohibited in the workplace. Provide enough examples to paint a complete picture of what is not acceptable behavior. Also, use respectful terminology in these policies, throughout the handbook and in all company communications.

Discrimination complaints

An EEO policy should create an atmosphere of open communication and trust so that employees can voice their discrimination and harassment concerns without fear of retaliation. To do this, they must have a way to safely report instances of discrimination.

In the workplace policy, include a description of the procedure available to employees who would like to report discrimination or harassment. The handbook only needs to describe the procedure one time so long as it’s clear that it applies to both harassment and discrimination complaints.

When considering the policy’s tone, remember that employees might not refer to it unless they feel that they are a victim of harassment or discrimination or when they witness such behavior against others. If the handbook is clear about your commitment to respond to these behaviors and that it takes complaints seriously, employees are more likely to come forward.

With a clear and effective EEO policy, employees will have comfort in knowing that the employer is committed to a harassment-free and discrimination-free workplace. This will promote an inclusive workplace and help prevent a reduction in productivity and employee turnover.

4. PTO policy with final wage information

More and more, paid time off (PTO) is becoming a strategic employee benefit that employees negotiate along with their compensation. Including a carefully written PTO policy will help employees understand their time off benefits and ensure compliance with final wage payment laws. These laws require an employer to pay employees earned but unused vacation or PTO upon termination of employment.

In fact, PTO policies must comply with the final wage payment laws of all of the states in which the employer does business. If your PTO policy doesn’t comply with these laws, then you may be exposed to litigation by former employees who didn’t receive their unused PTO.

From a strategic standpoint, a well-written PTO handbook policy can help an employer avoid unwanted PTO payouts by, for example, clearly separating vacation time from other types of PTO.

If you operate or have employees working in one of these states, check your PTO policy to make sure that it includes appropriate payment upon termination language and confirm it does not run afoul of any applicable laws.

5. Policies that promote the organization’s culture

Employees evaluate an organization’s core values and culture as they consider whether to join or remain with the organization. At the end of the day, employees want to know if the company’s culture matches their own core values when determining whether the organization is a good fit for them. An employee handbook can provide some clarity.

Culture and values

First, prominently place statements regarding the organization’s culture and values in the beginning of the handbook. This way, employees understand the company culture from the outset. They may be included with or directly after an employee handbook welcome statement. To help build a bond between employees and the organization, use language and a tone that is genuine, personable, and communicates a true commitment to the organization’s values.

DEI statement

The beginning of the handbook is also a great place to address the organization’s commitment to diversity, equity and inclusion (DEI). Consider including a DEI statement that reflects the organization’s commitment and approach to DEI in the workplace. Highlighting that you prioritize DEI in the workplace will help enhance employee morale and retention. It wil promote an inclusive work environment and foster a workplace culture of mutual respect and understanding.

Overall, employees who feel they share their employer’s values are likely to be more loyal, productive and compliant with the organization’s policies and procedures. So, don’t let your values go unnoticed.

Conclusion

The best employee handbooks are those that, in addition to ensuring compliance, accurately reflect the organization’s core values. When properly drafted, a handbook can help an organization connect with employees by communicating its values as a business and as an employer of choice. Most importantly, a well-drafted handbook will foster a positive working environment for all.