• Is Your Employee Handbook Working For or Against You?
  • January 12, 2012 | Author: Robert C. Boisvert
  • Law Firm: Fredrikson & Byron, P.A. - Minneapolis Office
  • “Think reading an employee manual is dull? Try writing one.” - Business Columnist Dale Dauten

    The poor employee handbook. Cursed by human resources professionals who struggle to write it and ignored by employees who are supposed to read it. Why should an employer even bother?

    Although much maligned, a well-written employee handbook can educate employees, reinforce company culture, and open lines of communication. The employee handbook is a communication tool. It is an opportunity to educate employees about the rules of the workplace and the employer’s expectations. And it can help start a dialog between employer and employees.

    Handbook Legal Protections

    A well-written employee handbook also can help an employer win and avoid lawsuits. For example, clear handbook language stating that the employment relationship is “at-will” can help protect against employee breach of contract lawsuits. In Minnesota and many other states, courts will presume that the employment relationship is at-will, meaning that either the employer or the employee may freely terminate the relationship at any time, for any or no reason. By including at-will language in an employee handbook, the employer can reinforce the at-will relationship and counter employee claims that the employer can terminate only in limited circumstances.

    But a poorly drafted or outdated employee handbook may create liability. This can happen in many ways. Rigid language in a handbook may restrict the employer’s flexibility and, if the employer deviates from the language, subject the employer to a breach of contract lawsuit. Minnesota and most other states have held that employee handbook policies can become enforceable contracts if a policy’s language is sufficiently definite. For example, if a termination policy promises that certain steps will be followed before an employee is terminated, the employer may be liable for breach of contract if it fails to follow each step.

    To reduce this risk, most handbook policies should be written using flexible language. Avoid using inflexible words like “will,” “always,” and “never,” and instead use flexible words like “may,” “ordinarily,” “typically,” and “generally.” For example, rather than stating, “Performance reviews will be given annually,” instead state, “Typically, performance reviews are conducted annually.” Or, “Generally, we try to review performance yearly.”

    Another important way to preserve flexibility is to include a clear and conspicuous disclaimer in the employee handbook. An effective disclaimer typically includes the following:

    • The handbook is not a contract.
    • The employee is employed at-will, meaning that either party may terminate the employment relationship at any time, with or without notice.
    • The at-will relationship may be altered only by a separate writing signed by a specified employer representative.
    • Except for the at-will policy, the employer has the right to change, terminate, or depart from any policy contained in the handbook.
    • The handbook replaces and terminates all prior handbooks and written and oral employment policies.

    To document that the employee received and agrees to the handbook, the employer should have the employee sign an acknowledgment containing similar disclaimer language.

    Two Important Policies to Consider

    The policies that an employer includes in its handbook should be based on legal requirements and business needs. Here are two important policies to consider including.

    Anti-Harassment. Every employee handbook should contain a policy prohibiting unlawful discrimination and harassment. The policy educates employees, discourages inappropriate behavior, encourages employees to raise concerns, and gives the employer the opportunity to address a workplace problem before it becomes a costly legal problem. And, if the problem turns into litigation, the policy may give the employer additional legal defenses.

    An effective anti-harassment policy should:

    • Prohibit and define unlawful discrimination, sexual and other unlawful harassment, inappropriate behavior, and retaliation.
    • Instruct employees to immediately report complaints to the employer.
    • Provide multiple complaint avenues, in case, for example, the accused harasser is the person to whom harassment is supposed to be reported.
    • Prohibit retaliation for reporting suspected violations.
    • Require employees to cooperate with the employer’s investigation.
    • Warn that violation of the policy may result in discipline or termination.

    FMLA. Employers covered by the Family and Medical Leave Act (FMLA) and who have employees eligible for FMLA leave should have a policy that describes the employees’ rights and responsibilities. Generally, an employer is covered by the FMLA if it has or had 50 or more employees each working day during each of 20 or more calendar workweeks in the current or preceding calendar year. Federal regulations require that any employer that has both a handbook and employees who are eligible for FMLA leave include “notice in employee handbooks or other written guidance to employees concerning employee benefits or leave right.”

    Sometimes employers not covered by the FMLA voluntarily choose to give employees “FMLA” leave. While voluntarily providing leave is commendable, generally it is better not to treat the leave as “FMLA” leave, since that may subject the employer to all of the FMLA’s legal requirements. Instead, employers not covered by the FMLA that wish to provide leave should adopt a more flexible personal leave policy. That way, the employer can provide employees with leave time but avoid unintentionally being bound by the FMLA’s broad and complicated requirements.

    Finally, employers should regularly have legal counsel review their handbooks to make sure they are creating a handbook that will not betray them.