The Essentials of the Small Business Employee Handbook

What’s the point of an employee handbook? Isn’t it just a collection of documents everyone will ignore?

It shouldn’t be. A thoughtful employee handbook is critical when you’re onboarding new hires. And the best company handbooks are an invaluable reference point for employees throughout their tenure at your business.

Many people might think that small businesses can get away without one. That’s a bad idea. The small business employee handbook is just as important as any at larger businesses, arguably more so because it can help small business owners to make sure that they’re on the up and up when it comes to the legalities surrounding employment.

If done right, your small business employee handbook is an opportunity to communicate clearly with your employees about everything from PTO policies to behavioral expectations and dress codes. Here’s how to go about putting one together for your small business.

What is a small business employee handbook?

First, a small business company handbook is the same thing as any other employee handbook. Every business, no matter how small, has policies and expectations they want to set for their workers. It provides guidelines on interacting with customers, sets standards for workplace behavior, and defines the rights workers have under federal, state or municipal laws.

Creating a handbook gives you the opportunity to think through all of your policies and expectations, making them clear for everyone.

What are the benefits of an employee handbook?

An employee handbook is beneficial in several ways.

Not only does an employee handbook make policies clear, it helps ensure they’re equally applied at work. Putting new policies in writing can make personnel management processes run more smoothly. Whether it’s managing sick leave or even weather-related policies, committing it to writing can improve time management on pondering individual cases one-by-one.

Handbooks are often used to share legally required communications. And these laws may vary by state. In New York City, for instance, businesses are required to distribute a notice of employees’ rights to sick leave.  So a small business employee handbook communicates both company and legal policies.

When should I update my employee handbook?

While you should revisit your employee handbook at least annually, it’s best to update it whenever a policy or legal requirement changes.

The elements of a handbook typically change for one of two reasons: a change in internal policy or a change in local, state, or federal laws that affect employment or otherwise affect how your business functions.

What policies should be included in a small business employee handbook?

Employee handbooks should suit a company’s needs and not the other way around, there are a few common elements that many small business employee handbooks cover:

• At will employment
• Harassment policies
• Equal opportunity and other non-discrimination policies
• Benefits including paid time off, sick leave, and the like
• Working hours
• Pay practices including pay periods
• Performance reviews
• Alcohol and drug policies
• Dress code
• Building safety and security

An employee handbook is critical document at any small business. It covers legal requirements. It communicates your values. It’s a central communication tool.

So when you draft your company’s handbook, don’t just set it on the shelf.