Ignorance is bliss, but being clueless can be dangerous: Our experts share some of their top employee handbook horror stories

Ignorance is bliss, but being clueless can be dangerous: Our experts share some of their top employee handbook horror stories

If your employee handbook was going to be audited tomorrow, how do you think it would go? If your stomach just dropped because (a) you don’t have a handbook; (b) your handbook hasn’t been updated in over 12 months; (c) your handbook consists of a potluck of policies you and your employees contributed over the years or; (d) your “handbook” is really just a few sheets of paper stapled together, then stop what you’re doing right now and read this Tip.

Over the years our HR consultants have reviewed hundreds of handbooks, and we’ve compiled our experiences—with the anonymity of the guilty intact—to bring you some of the most common handbook mistakes. Over the next several weeks, we’ll be sharing them with you in the hopes that others’ follies will help you to save valuable time and money by giving you the inside scoop on creating, managing and implementing your handbook the right way.

Let’s begin by reviewing what NOT to do:

Mistake 1: A handbook with holes

One of our clients proudly handed us a policy manual with the following table of contents:

• Company History
• Company Hours
• Paid Time Off & Holidays
• Health, Dental, & Vision Insurance
• Short-term & Long-term Disability
• Employee Discounts
• Timekeeping

Notice something missing? Yes! About 20 essential policies. While it’s important to communicate company benefits, the handbook should also serve to convey the company’s expectations regarding performance and conduct and to meet legal requirements that call for certain policies to be communicated to employees in writing. Avoid gaping holes in your handbook by learning about what policies to include.

Mistake 2: Policies that make you say “Huh?”

Here’s an excerpt from a Florida financial services company’s policy on progressive discipline: “Employees found to have dishonored company policy shall advance through the following disciplinary steps: first offense: verbal warning; second offense: written warning; third offense: suspension; fourth offense: termination. “

What problems do you see with this policy? Well…it’s confusing, vague and way too limiting. This policy doesn’t take into account each unique circumstance and leaves no room for management discretion. Thanks to our team of HR consultants, their policy is now straightforward and does not limit the company to following the progressive discipline process sequentially.

Mistake 3: A handbook covered in cobwebs

“We just never got around to implementing it.”

We can’t tell you the number of times we’ve heard this one. If you think the hard part is creating an employee handbook, there are many businesses out there that may say otherwise. From our experience the “we-just-never-got-around-to-implementing-it” excuse is due to the perceived time involved as well as an uncertainty about how to carry out the process.

Your plan of attack: Set aside time to discuss the contents of the handbook with your staff and to answer any questions they may have. And remember, not only is the initial introduction of an employee handbook important, but so is its introduction to new employees.

Mistake 4: “Out of sight, out of mind”: Failure to regularly review and update policies

“HELP! We haven’t updated our handbook since we created it 3 years ago!”

Sound familiar? An employee handbook that is out of date can be more damaging than not having one at all. Regularly updating your handbook will help to ensure that it remains compliant with applicable laws and that it is still meeting your needs. Get insider tips for effectively reviewing and updating your employee handbook.

Mistake 5: Fire at will—but only if you have a disclaimer

We’ve heard it with our own ears: a manager who thinks his staff is doing a great job says, “Keep up the good work and you’ll be a lifer”. Or“You’ll always have a job as long as I’m around.”

You wouldn’t want your employees thinking they’ve got a job for life, would you? Your best defense against breach of contract claims is a well written employment at-will disclaimer. An at-will disclaimer makes it clear that you do not intend to have the handbook construed as a “contract” or promise of employment. Disclaimers can even help to protect the company from verbal contracts made by managers, whether intentional or not. Get tips for writing effective handbook disclaimers.

Mistake 6: Not holding employees responsible

It’s simple: The handbook acknowledgment form, usually a single sheet of paper, is necessary in order to ensure that all employees verify that they have read, understand, and are prepared to comply with company policies. But why don’t more employers require acknowledgments? Most likely it’s the perceived time and energy that’s involved in the acknowledgment process: sending them any time there is an update, keeping track of who’s signed it and who still needs to, and properly storing completed forms.

Save time and money: The exclusive HR411 Employee Handbook Wizard simplifies this process for you by requesting your employees to complete acknowledgments electronically. Returned acknowledgments are stored in your account to be viewed and downloaded at your convenience—no paper involved.

 Mistake 7: Cutting corners by creating a Federally-focused handbook

Too often we see handbooks that only have a federal focus. What many employers forget is that state law is often more stringent than federal law. And when the two laws differ, the law that provides employees with greater protections must be followed.

Here’s one California employer’s policy on overtime: “Overtime is payable for all hours worked over 40 per week at a rate of one and one-half times the nonexempt employee’s regular hourly rate.”

What’s wrong with this? While the above policy complies with federal law it doesn’t comply with California overtime provisions. Almost all California employees must be paid overtime for all hours worked in excess of 8 in a workday, in excess of 40 in a workweek, or for the first 8 hours worked on the seventh consecutive day worked in a workweek. Be sure to check your state requirements or ask our experts and get the peace of mind that comes with meeting both your state and federal obligations.

Mistake 8: Managers are clueless about how to apply company policies

Have you held meetings with managers on how each policy is to be enforced?

We’ve seen all too many times: inconsistency breeds legal claims. Consider this: an employee files a discrimination suit because he was suspended following his third tardy in a 30 day period; but Sally, his co-worker, was only given a written warning for the same exact infraction. To prevent claims of bias, make sure managers use even-handed discipline and consistently apply all company policies.

Stay tuned for more “tricks of the trade”:

This is by no means a complete list of the mistakes employers make when it comes to employee handbooks and policies. While these mistakes are all too common, our upcoming Handbook Series will divulge the tricks of the trade to help ensure you don’t fall victim. It’s easy to reap the benefits of a legally sound employee handbook—if you know what you’re doing. So, stay tuned for tips, tricks and details on how to PROPERLY create, maintain, and implement an employee handbook