How to create an effective employee handbook

A step-by-step guide to creating purpose built employee handbook, that employees remember, and HR management teams love.

You’re hiring. It’s an exciting time, yes, but don’t think the job is done when the offer letter is signed.

A new employee’s first few days and weeks on the job sets more than just the tone in his or her tenure with your company. Apart from getting a general good or bad feeling about your company and brand, the first few weeks of work is when your company has the opportunity provide a framework for enduring employee success, productivity and contribution.

This is your opportunity to help your new hire feel confident in their role, and explosive in their contribution.

A little extra up front investment, can pay off for years to come.

One of the surest ways to improve the onboarding experience, and ultimately the full lifecycle of your employees, is to create and distribute an employee handbook on your new hire’s first day.


What Is an Employee Handbook?

The employee handbook is a packet of information, provided digitally, in-hand, or both, to every employee in the company. It shares useful information regarding your company culture, policies and expectations, as well as communicates any specific details pertinent to working for your company that may be unique from other employers. Many companies use the employee handbook as a tool to disseminate federal or state mandates for written communication to employees, such as Equal Employment Opportunity.

While an actual employee handbook is not a federally mandated document, it’s a great way to ensure you have the forms that are required in one, easy to use document, that can be recreated and given to all your new hires.

  • But what goes into an employee handbook?
  • What should you leave out?
  • And how do you make one that resonates with your employees and actually communicates the heart and soul of your company in an approachable and memorable way?

Let’s walk through the steps experts have identified are key to a stellar employee handbook.



Step 1: Tell Your Story


Your company “story” is at the heart of your employee handbook, and should be the first section of your book. In showcases your roots, your personality, and your motivation as a company. Your new hires are meeting your business for the first time, and just like meeting a person for the first time, they want to become better acquainted.

If you don’t know what your company story is, try this: Imagine telling your grandma about your company and see what comes out. What is the company name, what does the company do, what is your mission?

Your employee handbook introduces your work culture and presents your story in a uniform, documented way.

Company Story Checklist

  • Your founder story: How did it start? When was it founded? Who founded it? Why?
  • Your core values: Which values should employees seek and embody?
  • Your mission statement: Get help writing a mission statement here.

Building your first employee handbook?
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Step 2: Document Your Policies & Present Your Perks

A lot of people ask: “is there a law stating a small business has to have an employee handbook?” The short answer is no. But it is a good idea, and often recommended by legal professionals.

Your handbook is a great conduit for providing legally required written information to employees, as well as communicating other policies, guidelines, and expectations in one clean, easy-to-use document. It’s also a good document to have in case you find yourself in a litigative situation or employee-employer conflict. If you have provided your policies clearly in a handbook, your employees share the responsibility of reading and knowing what those policies are.

It’s not just a policing tool, though. Policies and perks empower employees with opportunity, too. Policies such as flexible work arrangements or work from home Fridays, can really improve your employee’s view of your brand, or a potential candidates desire to work for you.



A good place to document legally required written information

Some employer information must be delivered in writing to each employee (e.g., equal employment opportunity (EEO) statements, Family and Medical Leave Act (FMLA) notices), etc.. Rather than managing each lawful communication one-by-one, employers can compile them neatly in an employee handbook.

State your policies

An employee handbook is a great place to communicate your company policies, from cell phone policies, work at home policies, or even things like discrimination claims.

Providing this information an up-to-date employee handbook may provide legal protection if an employer’s policies or practices are ever challenged in court.


Which benefits do you include?

Do you provide health insurance? Commuter benefits? 401(k)s? What are the policies you’ll be sure to be asked about. Include those in your employee handbook. You’ll be asked fewer questions and save your business time.

Which benefits are required by law?Find out: The Benefits Benchmark Report


Often businesses have employee benefits that serve as company differentiators for recruiting. Publish these in your handbook, so all employees can be reminded.

Step 3: Spice It Up & Dumb It Down

Effectively disseminating your employee handbook — aka getting your employees to actually read it — is the last step. The best advice is to make it visual, free of legal jargon, and memorable. You’ll find the cost of investing a little design, or creativity into your employee handbook, could be the difference between a costly legal conflict down the road, or not. Additionally, publish your handbook in places employees have no problem finding: e.g. both digitally, and in hard copy on their desk on day 1.



Step 4: Confirm Read & Receipt

The final step in effective employee handbooks is to ensure every employee signs an acknowledgement form of receipt. Their signature binds them to acknowledgment of your company policies and protects you from litigation — not to mention receiving your employee’s read & receipt signature is required by law for some of the written notices, too. If you have a printed employee handbook, ensure you keep hard copies of every signed document in a secure location. You can create digital copies of employee handbooks, too, and obtain digital signature. This way, you can save important employee documents in the cloud.

Companies that upload digital copies of employee handbooks can receive digital signatures — a smart, never-lost solution.



Need extra help?

Hopefully this step by step guide helps you know what to include, and what not to include in your employee handbook. But let’s be honest, we could talk all day about employee handbooks. If you want to keep learning about this helpful company resource, here are a few more articles to dive into.