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Employee Handbook 101: Tips, Considerations, and Best Practice

A well-crafted employee handbook is a cornerstone for fostering a positive workplace culture, mitigating legal risks, and aligning employees with organizational goals. Despite the size of your company, it’s essential to have an employee handbook in place and ensure compliance with relevant laws and regulations. When it comes to employee handbooks, there are many pitfalls and considerations that HR professionals should be aware of.

Why is it Important to Have an Employee Handbook? Is it Mandatory?

Compliance-wise, not all businesses are required to have an employee handbook. Only companies with 10 or more employees are required by law to have an employee handbook. However, an employee handbook can serve as a great tool to help companies avoid legal risks and as an internal communication guideline that helps employees better understand their rights and expectations from the company.

  • Communication of expectations. An employee handbook serves as a central document for communicating the organization’s policies, procedures, and expectations to employees. It helps set clear guidelines on behavior, performance, and conduct in the workplace.
  • Onboarding. An employee handbook is a valuable tool during the onboarding process. New hires can refer to the handbook to understand the company culture, policies, and procedures and have a smooth transition into their new role.
  • Risk mitigation. By addressing potential areas of conflict and clearly communicating policies, an employee handbook can help mitigate risks associated with disputes and other legal challenges. 
  • Maintaining compliance. Depending on the specific region your organization is in, certain policies and information must be communicated to employees by law. An employee handbook will be a central place to display this information.
  • Reference for HR and management. The handbook also serves as a reference for HR professionals when addressing employee-related issues and provides a framework for handling various situations. 


What Should be Included in an Employee Handbook?

While specific compliance requirements may vary based on factors such as the industry, location, and size of the organization, here are some general areas that you should consider when developing an employee handbook:

Employee Handbook Policy vs. Procedure Manual

An employee handbook is an overview of the company’s policy and has a broader scope and covers a range of topics related to employment and organizational culture. It is often the one shared for onboarding and communication of organizational values. While a procedure manual goes into detail about the standard operating procedures with step-by-step guidance, entailing specific protocols in the day-to-day operations. 

In practice, you can choose to combine the two documents into one single comprehensive guide or maintain separately. If your business doesn’t have a procedure manual in place yet, it’s crucial that you at least develop a safety policy procedure to safeguard the day-to-day operation. 

Considerations When Developing an Employee Handbook

When developing an employee handbook, there are some core considerations that employers should have in mind:

  • What type of language to use in the handbook
  • Branding of the handbook
  • How would the handbook impact operations in the future
  • Compliance considerations
  • Employees’ rights to “Protected, Concerted Activity”
  • Pitfalls of violation of the labor law
  • EEOC requirements

How Often Should I Review and Update the Employee Handbook

The best practice is to review your employee handbook regularly and make updates in a timely manner. The goal is to have your employee handbook always reflect the reality of your company’s policies, no matter what changes were made. If you don’t have the resources to do so, you should at least conduct a yearly review of your employee handbook.

Employee Handbook Best Practices

Employee handbook best practices are rooted in clarity, consistency, and adaptability. Companies need to establish a well-defined purpose before actually crafting the content. Companies should be well aware of their priorities and what role they want this handbook to play in their success. Communication tool? Legal Guide? Culture Enabler? This can mainly depend on each company’s status quo and affect how their employee handbook is drafted.

To get more detailed instructions and guidance on employee handbooks, watch our most recent webinar: Employee Handbooks - To Do or Not To Do.

Employee Handbooks Webinar


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Employee Handbooks Webinar

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