Employee handbooks are not always at the front of a contractor’s mind. Either the company doesn’t have one, or it’s so old (and out of date) that no one really knows where it is or what it says.

Should contractors have an up-to-date employee handbook? The simple answer is yes. Although not legally required, employee handbooks serve several important functions, including: (1) they provide legal protection; (2) they inform employees of the company’s expectations, and (3) they help ensure equal treatment.

So what should be included in your employee handbook? While every situation is different, signatory contractors should consider adding each of the policies below in any employee handbook.

At-Will Statement

An employee handbook should have a clear statement that, absent a signed employment agreement for a specified term, employment is at-will, and nothing in the employee handbook alters the at-will status of employment.

The employee handbook should also state that, for employees covered by a collective bargaining agreement, the collective bargaining agreement supersedes any conflicting provision in the employee handbook.

Contract Disclaimer

An employee handbook should include a “disclaimer” stating that nothing in the handbook creates a contract for employment and that the employer reserves the right to modify the handbook and any policies at any time.

Equal Employment Opportunity (EEO) Policy

A short clear statement prohibiting any and all discrimination on the basis of any protected class, including race, gender, disability, and age.

Policy Prohibiting Unlawful Harassment

In addition to prohibiting discrimination, every employer should have a policy prohibiting all forms of “unlawful harassment,” including sexual harassment. In addition to prohibiting unlawful harassment, the policy should provide a clear procedure for employees to report harassment, including to their supervisor, human resources or even the CEO.

Having a procedure for reporting unlawful harassment can help an employer avoid liability if an employee alleges that he or she experienced unlawful harassment.

Reasonable Accommodation Policy

The Americans with Disabilities Act and Canadian Human Rights Act not only prohibits discrimination against workers with a disability, they also require employers to reasonably accommodate an applicant or employee with a disability. The policy should reiterate the company’s commitment to non-discrimination, to engage in the interactive process and provide reasonable accommodations where available.

Sick, Vacation and/or PTO

The handbook should also address the company’s policies on sick leave, vacation, and/or PTO for non-union employees. Be sure to address issues like carry-over, accrual caps and payout at separation. State and local laws vary, so be sure to check with counsel regarding any necessary provisions.

Disciplinary Policy

For non-union employees, an employee handbook should contain examples of offenses that will lead to corrective action up to and including termination of employment. The employer should include a disclaimer that the list includes examples of offenses and is not exhaustive.

Also, if an employer has a progressive discipline policy, the handbook should state that the employer has the ability to skip steps and proceed directly to termination in appropriate circumstances.

Other Legally-Mandated Policies

Depending on the company’s size and location, there may be other policies that are required by law. For example, employers with 50 or more employees are required to have a policy addressing the Family and Medical Leave Act or FMLA.

Because laws are always changing, it is also important to have your handbook reviewed by an employment attorney on a regular basis.

Employee Acknowledgment

A handbook should also include an “acknowledgement” whereby an employee receiving the handbook signs to show that they have received a copy of the handbook and have read all of its terms. Then, when you make updates to the handbook, you can have employees acknowledge that they have received the latest version.

Bottom Line

Creating an employee handbook can be a daunting and intimidating task. As explained above, however, an employee handbook can be a useful tool to ensure that workers are treated equally and can even help an employer avoid liability. Thus, it is important for contractors to take care in crafting their employee handbook and ensuring that it complies with federal, state, and local law.