Lancer Insurance
Tuesday, March 05, 2024


Human resources is all about the relationship between you as an employer and your employees. It’s a complex bond affected by your business model, your company culture, your market, and myriad other factors, including federal, state, and local law.

Because of this complexity and the potential pitfalls in navigating this relationship, you’ll frequently hear HR professionals preaching “document, document, document!” And the primary document we’re referencing is your employee handbook. To be sure, all kinds of documentation is called for along the way, but there is no other document that is so all-encompassing or that sets the expectations of the relationship quite so clearly as the employee handbook.

HR Coach Amy Cooley Ideally, this handbook will help to guard you against certain claims and risks, which means that mistakes can be particularly costly. The good news, however, is that there are five common handbook pitfalls that can be avoided and mitigate risk.

1. Allowing an Implied Contract
A thorough and well-written handbook will include, among other things, clear expectations you have for employees as well as what they can expect from you as an employer. The challenge here is that sometimes this outline of expectations can start to read like a promise or guarantee of employment. For example, it may be interpreted that so long as the employee doesn’t “break these rules,” they can expect continued employment. This kind of unstated promise could legally be considered an implied contract, putting you at risk of a wrongful termination claim down the road.

While every state in the US (except Montana) recognizes the “at-will” employment relationship, you cannot assume that will cover you against such a claim. Instead, it is important to state explicitly within your handbook that the document does not constitute a contract or guarantee of employment, and that employment is at-will. A lawyer or HR professional can help you draft this disclaimer.

2. Not Asking Employees to Sign
Every employee handbook should conclude with an employee acknowledgement. On this final page, you’ll want to craft a statement that includes a confirmation that the employee has received and understands the handbook, and that they agree to act according to its guidance. This statement should also reiterate your disclaimers, like the one above about at-will employment, but also that the handbook is subject to change.

HR Coach Amy Cooley This signed acknowledgement should go in the employee’s file and serve as confirmation that your policies and expectations have been communicated to them directly. Now you can safely refer back to your handbook during performance reviews and employment decisions of all kinds. Not only is the documentation important for mitigating your risk, the transparency also helps to set the tone of the relationship from the outset.

3. Unclear or Over-Generalized Language
When describing your policies and expectations, try to avoid language that might be too general or unclear. Don’t assume that your employees will understand your standards without some specific guidance. For example, stating that “good attendance is important” is a good start, but will likely be interpreted differently by every reader.

Instead, try adding some context. Why is attendance important? What generally constitutes “good attendance”? What is considered an excused absence, rather than unexcused? How are employees expected to communicate an absence (when, how, to whom)? Is there an allowance of paid or unpaid time off? What happens if an employee is a no-call, no-show?

4. Backing Yourself Into a Corner
At the same time, there is a fine line between being clear about your expectations, and actually backing yourself into a corner. Again, in the case of your attendance policy, you might be tempted to say something like “three unexcused absences will result in a warning, and three warnings will result in termination.” That’s very clear, right? So, what is the problem?

Well, what if it is a top performer who has had a great record for five years until now? They have a great attitude, are quick to learn and adapt to change, and they have confided with you about a personal issue they are facing recently. You might be inclined to give them some leeway in this scenario.

On the other hand, what about an employee who frequently skirts the line, coming just shy of that third warning. Then they wait for their attendance record to “clear” and start the pattern again every six months or so. You’ve had it, and the employee is showing no effort to improve.

The language in your handbook has backed you into a corner in both scenarios. What might be better? First, instead of a specific number of instances, you might refer to frequency or patterns. In addition, we recommend using a phrase like “... may result in disciplinary action, up to and including termination.”

This is not to say there are no circumstances that merit stronger language. Fraud, workplace violence, and other egregious behavior may need less room for manager discretion.

5. Failure to Cover Important Policies
While it is important to note that your handbook is not just a collection of policies, it is critical that you do cover certain general and compliance policies. Once you’ve laid out a welcome to employees and information about your mission, values, and code of conduct, we recommend including (at least) the following:

❱ Anti-harassment
❱ Alcohol/substance abuse
❱ Code of conduct that reflects those values
❱ Confidentiality statement or policy
❱ Electronic communications/social media
❱ Equal employment
❱ Time reporting and payroll
❱ Workplace safety
❱ Open door policy/methods of communicating with management
❱ Remote work

Developing or renewing your handbook is a big job to tackle and needs to be handled not only with a knowledge of legislative and regulatory compliance, but also with insight into your unique business and culture. Don’t leave it to chance—we highly recommend consulting with an HR professional for support with your handbook and all your HR needs.   [CD1022]

Amy Cooley is HR Administrator for The LMC Groups. She can be reached at