6 Reasons Why You Need an Employee Handbook

BizCentral USA has partnered with ADP® to provide members with the faster, easier and more reliable payroll and HR solutions. Additionally, ADP provides complimentary articles on best practices and the latest regulatory insights that may impact your workplace. The below article on Employee Handbooks is an example of this service that ADP clients receive each week in our client Tip of the Week. 


An employee handbook is one of the most important documents an employer can maintain. Why is it considered essential? We provide six important reasons below.

  1.    Help formalize company policies.

Most companies have policies governing their employment practices, but they’re sometimes maintained informally. This can lead to inconsistent application and confusion about employer and employee rights and responsibilities. An employee handbook helps formalizes those policies so that employees have a written resource to read and reference.

  1.    Meet state policy requirements.

Although there is no law that requires a written employee handbook, there are laws that require employers to provide certain information to employees in writing. An employee handbook can be the vehicle to help employers effectively disseminate the required information and fulfill these requirements.

For example, a growing number of states are requiring employers to maintain a written policy on preventing harassment in the workplace. This includes California, where all employers must develop and disseminate a written harassment, discrimination, and retaliation prevention policy. 

  1.    Support the onboarding process.

A new hire’s first days, weeks and months establish the foundation for the rest of the employment relationship. An effective employee handbook can help the process by introducing new employees to your company, culture, and values. A well-written and organized handbook also lets employees know what they can expect from you and what you expect from them. For example, you can use it to communicate important workplace policies, rules, procedures, as well as important benefits information.

  1.    Guide employment decisions.

A handbook can also serve as a guide for managers and employees regarding how the company addresses workplace issues and questions. Additionally, it can help demonstrate fairness when policies are applied and enforced consistently, and may help to justify or defend certain employment decisions.

  1.    Reinforce at-will status.

It’s a best practice to prominently display an at-will statement in the beginning of your employee handbook (except in Montana, where at-will employment isn’t recognized). At-will employment generally means that, absent certain exceptions such as an implied contract or public policy, either the employer or the employee can terminate the employment relationship at any time and for any reason, as long as the reason is a lawful one. Absent an at-will-employment relationship, the employer may have to establish “just cause” to terminate an employee. Reinforce at-will status in your handbook acknowledgment form as well.

In the handbook, make sure you also avoid policies that may create confusion about at-will status, such as those that restrict your ability to decide what type of discipline is appropriate given the severity of the offense and the employee’s history of misconduct. State that violations may result in disciplinary action, up to and including termination, and that the company reserves the right to decide what disciplinary action to take in any given situation. Keep in mind, however, that treating employees fairly is key and similar situations and past practices should guide and impact the disciplinary action that you take.

  1.    Inform employees where to go if they have questions or concerns.

Throughout the handbook, make sure you include contact information for the individuals to whom employees should direct questions about the employee handbook and the policies within it. For complaints about violations of the policies, employees should be given more than one person they can contact. Keep in mind that states that require certain policies may also require employers to include information on where employees can file complaints with the state about alleged violations. 


An employee handbook can be one of the most effective ways to communicate with employees.  Make sure you draft yours carefully and review your employee handbook regularly to ensure it stays current with developments in federal, state, and local laws as well as best practices.

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