The Ultimate Guide to Creating an Employee Handbook

An employee manual not only sets the stage for your company’s culture, vision, vibe, and rules of the road, but it also establishes your intention to communicate clearly. Also, certain elements within the handbook—such as perks, compensation, benefits, and a safe work environment—are essential for the retention of employees.

This guide provided by The Hartford will explain why you need an employee handbook as a small business owner, what to include, how to create one, and how to make sure your employees make it one of the first documents they read on day one.

The Purpose of an Employee Handbook

An employee handbook is the operating playbook and communication tool you and your team need to codify the rules of the road for working at your small business. A well-written handbook offers a breakdown of the standards, expectations, and processes you expect your employees to follow, while also signaling to them how you’ll manage situations that arise.

Great handbooks are documents that will excite and empower your employees, while reinforcing your culture and values. The employee handbook provides clarity and context—should any problems arise—so employees know precisely where to turn. New hires are given a copy of the employee manual with a form to sign, confirming they’ve read through it and understand its contents.

While the manual doesn’t guarantee compliance (and it’s not a formal employment contract), it does give all parties clarity on how to operate, and it can protect small business owners from legal action or even be used as evidence in an anti-discrimination lawsuit, for example.

Why You Need an Employee Handbook

It’s essential to have a playbook in place, because it not only articulates that all employees are treated equally and fairly, but also helps promote a positive, welcoming, productive, and safe working environment.

You may be wondering if having an employee handbook is mandatory for your business. While the Federal Department of Labor doesn’t require the actual creation of the document, you are required to inform employees of their rights in the workplace—whether that’s through visible workplace signage or a formal manual. Smart small business owners opt for both, to have all their bases covered.

You want first to review the Department of Labor’s mandatory workplace posters. and then search for any state requirements on your State Labor Office’s website.

Remember, when you’re creating an employee handbook, you want to go beyond the bare minimum to also focus on policies—legal or otherwise—that have a direct impact on your small business.

The 10 Must-Includes in Your Employee Handbook

1. Company Overview, Vision, Mission, and Values
2. Compensation, Benefits, and Perks
3. Code of Conduct
4. Anti-Discrimination and Equal Opportunity Policies
5. Family and Medical Leave Policies
6. Schedule, Hours of Operation, and Paid Time Off (PTO)
7. Workplace Safety and Security
8. Digital Conduct and Social Media Policy
9. Nondisclosure and Conflicts of Interest
10. Important Disclaimers

How to Get Started

• Step 1. Roll out the red carpet. Your new employee is fresh off the interviewing and negotiation process, and you want the positive energy and excitement to continue. Your employee handbook is one of the first key encounters they’ll have with you onsite, and first impressions count. From the design and text, to the opening pages, you want to make your recruit feel right at home. Start with your business’s verve and passion. Open with your vision, mission, and core values. Explain the kind of business you want to operate and how your employees play a pivotal role in that story, and let them get to know you first before they fall into the labyrinth that is your legalese.
• Step 2. Dive into policies and procedures. Next, you want to get into the meat of the handbook. When including all of the components as outlined in the previous section, consider creating illustrated examples, so employees can gain context and clarity. Maybe you want to visualize elements of the manual with graphics, comic strips, photos, or illustrations. Get creative with how you represent information. We’ll dive into examples shortly.
• Step 3. Review your handbook with key stakeholders. Make sure you have trained professionals in the form of Human Resources representatives or consultants, as well as employment lawyers, who are up on the latest federal, local, and state laws. It pays to have them vet your document to ensure that not only have you articulated the information clearly, but also you’re not opening yourself up to uncertainty, misinterpretation, or downright liability. Spending the time now to have your material properly vetted will pay dividends down the road.
• Step 4. Design and distribute. The options are limitless. You can keep it simple with a word processed document you hand to new employees as part of their onboarding process, or you can design something visual and special that can be delivered in-person and accessed online. It’s really up to your resources, brand, and budget. The key here is to give employees all the information they need to be successful in your business. Packaging and design can heighten excitement and create more feelings of loyalty to your business as a living, breathing brand.
• Step 5. Make regular updates. Listen to your employees, peers, HR staff, and lawyers throughout the year. Our world is continuously changing—there’s new technology on the market every day—so it’s important to make sure your manual keeps pace with the trends and times. Consider reviewing it at least once a year and making material updates when needed.

Resources you can use if you get stuck

Here are several employee handbook templates available online:

• The National Federation of Independent Business (NFIB) template
• The National Council of Nonprofit Associations template
• RocketLawyer template
• Lessonly template

To get deeper insights into what to include in your manual, check out:

• Society for Human Resource Management (SHRM). They offer their members a free employee handbook template, as well as customized options for a fee.
• U.S. Department of Labor. Familiarize yourself with the laws about equal employment opportunity, family and medical leave, etc. You also want to research laws at the state level to make sure you’re compliant.
• Occupational Safety and Health Administration (OSHA). They offer insights on employer responsibilities for providing a safe workplace.

How to Create a Handbook That Your Employees Will Want to Read

1. Open with your vision, mission, and values.
2. Talk like a human.
3. Play up your perks.
4. Consider packaging and presentation.
5. Be smart with formats.
6. Be fair and consistent.

For more helpful tips, read the full article here.