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Employee Handbooks: How to Write a Handbook

Creating an employee handbook gives a clear guideline for your expectations of employees and how your company handles different situations. These policies can help guide managers, reduce misunderstandings, and can even provide legal protection. Should a conflict arise between you and an employee where you need to prove you were following federal and state laws, clear and comprehensive policies and documentation can be what stands between you and fines, penalties, or even jail time.
As such, it’s vital to be as detailed as possible when creating policies and procedures. For example, instead of saying employees shouldn’t be tardy, you’ll want to define what counts as tardy – like being more than 30 minutes late to work. Then, you’ll want to detail how many tardies employees are allowed before facing disciplinary action and what disciplinary actions will be taken, like a viral/written warning, suspension, or discharge – and when.

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Federal Laws

Additionally, there are a number of federal and state laws that affect employees you should consult when creating policies and procedures to ensure you’re legally within your rights to exercise these policies including but certainly not limited to the following:


  • Family and Medical Leave Act (FMLA). This law entitles employees to unpaid, job-protected medical leave for themselves and specific family members.
  • Consolidated Omnibus Budget Reconciliation Act (COBRA). COBRA allows workers and their families who lose health benefits to continue receiving coverage.
  • Equal Employment Opportunity Commission (EEOC). This agency oversees and enforces federal anti-discrimination laws.
  • Americans with Disabilities Act (ADA). This law that prevents discrimination against people with disabilities and entitles employees to provide reasonable accommodations in the workplace.
  • Fair Labor Standards Act (FLSA). The Wage and Hour Division (WHD)’s Fair Labor Standards Act (FLSA) provides one of the largest reaching federal laws concerning labor. This law details federal standards around everything from wages and overtime to employee record-keeping.
  • Occupational Safety and Health Act (OSHA). This agency establishes and enforces regulations surrounding workplace health and safety.


You can also find more industry-specific information here at the US Department of Labor’s official website, a cheat sheet outlining individual state laws here, and a full list of federal agencies and policies that handle labor issues here.


Overwhelmed? Don’t worry. We’ve broken down the most important policies and procedures your business needs to establish as well as which laws to consult when drafting them.

Diversity, Equity, and Inclusion

Your diversity, equity, and inclusion policy should outline your company’s attitudes towards equality and diversity as well as how you plan to address these issues in the workplace. These policies protect employees from discrimination, promote diversity inside the workplace, and detail how your company plans to respond to the needs of employees. For example, you’ll want to include which specific accommodations are available for employees and how employees should report discrimination.


When establishing this policy, be sure to consult federal and some state requirements for employees with disabilities or religious beliefs and practices and directly address the needs of people who may face inequality or harassment under the Equality Act (2010). This act protects people with the following nine protected characteristics: age, disability, sex, sexual orientation, race, religion or belief, gender reassignment, marriage or civil partnership, and pregnancy and maternity. Additionally, you’ll want to consult the EEOC’s prohibited employment policies and practices.

Employee Conduct

This is a general set of behavioral rules employees should follow. When establishing your company’s employee conduct policy, it’s important to be specific and differentiate between good natured, nondestructive pranks and destructive hazing that can drive away good employees or lead to injuries and lawsuits. For example, you may want to create a policy around touching other employees’ tools or lunchbox without permission since these are common targets of pranks and explain that you have a zero tolerance policy around it because employees could get sick or tools might be damaged.


A few examples of employee conduct you should address include:


  • Alcohol and drug-use in the workplace and reporting to work in an unsafe condition
  • Possession of weapons
  • Slurs and epithets
  • Discrimination and harassment
  • Fighting and threats of violence
  • Willful destruction of company property or another employee’s property
  • Unwanted bodily contact or advances
  • Theft, fraud, embezzlement
  • Excessive absenteeism
  • Knowingly mishandling a customer’s or potential customer’s account
  • Smoking
  • Falsifying Company documents or records, including timekeeping records
  • Insubordination
  • Excessively abusive, threatening or obscene language
  • Inappropriate interactions with customers, like entering a home without an adult present
  • Unauthorized disclosure of confidential business information
  • Fraternization in the workplace

Workplace Health and Safety

Workplace accidents are inevitable. However, providing high-quality training and protective gear and outlining clear, zero tolerance safety policies can help you to avoid the bulk of accidents. These policies lower injury/illness costs, the risk of property damage, absenteeism and turnover, increase productivity, protect your company’s reputation, and most importantly, they keep your employees safe.


Safety requirements can differ wildly across different trades but in essence, your health and safety policy should include:


  • Your company’s safety requirements and emergency procedures. For more information about federal and state requirements, consult OSHA’s Small Business Handbook and Compliance Assistance Quick Start and check here for state-specific laws.
  • Training employees must complete
    How to report workplace accidents or unsafe conditions
  • What PPE (personal protective equipment) is provided and required to be worn, like steel toe boots – and when. You can even go into detail about specific policies surrounding eye, hearing, hand, respiratory, and head protection.
  • How to submit worker’s compensation claims and any limitations
  • What disciplinary action will follow failure to comply with OSHA guidelines and company procedures


In this section, you’ll want to outline which holidays your company plans to observe and whether employees will be compensated extra for working holidays or given PTO for holidays. Most employers opt to give employees double-time for working on holidays, but outside of state laws in Massachusetts and Rhode Island, there are no federal or state laws that require extra compensation or PTO for holidays. You can find a list of federal and state holidays here to consider when building your policy.


A good vacation policy can help companies stay competitive when hiring. On average, employers offer employees 10-15 days of paid vacation depending on the length of time they’ve been with the company. While there are no federal or state laws that require paid/unpaid vacation days, some states have laws that require employers to pay employees’ unused vacation time when their employment ends.


In this section, you’ll want to outline how long paid vacation lasts, whether it’s paid or unpaid, when employees are eligible to take vacation time, how to submit advanced notice – and how far in advance, and which employees are eligible. For example, you may reserve paid vacation time for full-time employees after a year with the company and add a clause that vacation days can’t be used during the busy season.

Family and Medical/ Sick Leave

Under the FMLA, certain employees are entitled to up to 12 weeks of unpaid leave for certain family/medical situations. This guarantees employees job-protected leave for family and medical reasons even if they aren’t being compensated for their time away. There are no federal laws surrounding paid sick leave, but several states and localities require it. You can find more detailed information about your state’s leave laws here: Family Medical Leave and Paid Sick Leave. Additionally, you can find a number of helpful resources like sample forms to provide the notices required under the FMLA on the US Department of Labor website or your state’s website.

Death/Bereavement Leave

No federal laws require employers to provide bereavement leave, but some states require it. You can find your state’s laws here. The average business provides paid leave of 3-5 days following the death of an immediate family and 1 day for other relatives and friends but some states like Illinois require employees to provide 2-6 weeks of unpaid bereavement due to the loss of a child.

Jury Duty

Jury duty laws vary wildly across state lines. Some states require employers to pay their employees while they serve on a jury and depending on the state, this could be either the employee’s regular salary or a prorated amount. Additionally, many states prohibit employers from requiring employees to use paid vacation, sick, personal, or other types of leave during this time.


The majority of states and even some local ordinances have laws surrounding voting leave time. Some states require employers to provide paid leave time and others prevent employers from being able to dictate which hours employees can use (e.g. going in the morning vs. evening). You can find more information about your state’s specific voting laws here including how much time employees are entitled to, whether this time is paid/unpaid or requires advanced notice and proof of voting, and any exceptions to these rules.

Personal Emergency Time

In general, employers provide a catch-all policy for all other unforeseen personal emergencies, like unforeseen auto repairs or household repairs. When drafting your policies around personal emergency time, be sure to consult state laws to check whether this time can be drawn from accrued sick or vacation time and whether your state has specific requirements surrounding these laws. For example, some state laws have specific requirements surrounding blood, bone, and organ donation, being the victim of a crime, public service, alcohol and drug rehabilitation, participation in childrens’ school activities, and accompanying children or elderly relatives to routine dental/medical appointments. When outlining these policies, be sure to note any consequences of overuse of emergency personal time, like termination or other disciplinary action.

Dress Code

Most customers will form an opinion of you and your business in just 3-5 seconds, so a polished uniform and good hygiene can go a long way in helping make a first impression positive. However it’s important to strike a balance between professionalism and being accommodating towards employees. Otherwise, you may lose good employees to a more flexible employer or, in more extreme cases, find yourself under legal scrutiny for discrimination. Be specific when outlining your company dress policy and be sure to include consequences for showing up dressed inappropriately and any accommodations available, like uniform allowances or spare uniforms, and exceptions to rules like religious or cultural practices.


When developing a dress code, you should be attentive to:


  • Weather and work conditions, like extreme heat or cold.
  • Religious and cultural dress and grooming practices, like head coverings and ethnic hairstyles.
  • Changing statistics and cultural norms. For example, tattoos and multiple piercings have become less taboo and more mainstream: 47% of millennials have at least one tattoo. So, a policy like only allowing women to wear one set of earrings might feel dated.
  • Safety concerns. For example, you may require employees with long hair who work in the field to put their hair into a ponytail or clip it back while at work or require employees wear badges when interacting with customers. Generally, a company uniform is one of the best ways to ensure employees comply with OSHA and other safety regulations.

Meal and Break Periods

Meal and break requirements are largely handled on the state-level. You can find more information about your specific state’s laws and regulations here:

Generally, most employers offer 1 hour lunch and two 10-20 minute breaks for every 4-hour work period. While breaks are included as compensable work time, meals are not so long as employees are not required to work during these breaks. Fair Labor Standards Act (FLSA), employers must pay non-exempt employees for work done during a meal break, even if the work is done voluntarily, so you may create policies that mandate employees take meal breaks away from their work to ensure compliance.

On Call Time

If your business requires employees to remain available after their shift ends, you need to establish clear policies about your expectations of employees and decide if they legally need to be compensated for this time. If employees are able to use this time for personal use without restrictions, they do not require compensation. However, if they’re burdened by restrictions like taking calls during this time, it may legally fall under working hours.


When developing your on-call policy, it’s best to consult with a lawyer because this can be a legal grey area and set clear expectations, like what means of communication is needed and required response time as well as any prohibitions, like leaving the area or consuming alcohol.


While employers are required to pay non-exempt employees an overtime rate of time and a half all hours worked in excess of 40 hours, there are no limits to the number of hours an employer may require an employee to work in one workday or one workweek.


At minimum, employers are required to pay employees overtime (usually time and a half) for any hours over 40. Exceptions include:


  • Independent contractors
  • Executive, administrative, and professional employees who earn at least $684/week and receive the same salary every week, minus full-day absences according to your paid sick or vacation leave policy.

Cell Phone and Internet Usage

In this day and age, prohibiting electronic devices and internet use is no longer a realistic expectation. So, it’s important to outline your policies surrounding the use of electronics like cellphones in the workplace and differentiate between the use of personal devices and company-owned devices.


A few policies you may want to consider include:


  • Video/auto recording, especially on customers’ private property or in restrooms/locker rooms.
  • The frequency and length of calls permitted during work hours
  • Security measures and monitoring that may need to occur – especially if employees are using their personal devices for work. For example, employees may be required to install anti-virus software or trained to prevent phishing and other security concerns.
  • Requiring employees to set cellphones to silent or vibrate mode while interacting with customers or other circumstances where incoming calls can be disruptive.
  • Restricting personal use of company-owned devices.
  • Emphasis that employees are expected to follow local, state, and federal laws and regulations regarding the use of cellphones, like using their phone while driving. To encourage employees’ safety, you might even consider providing hands-free equipment for employee vehicles.
  • Limits on use and when it’s acceptable to use electronic devices like breaks and lunchtime – and what employees aren’t permitted to do on their devices at this time, like viewing obscene materials or playing videos customers and other employees can hear.
  • Loss, damage, or theft of company-owned devices – and any requirements to produce the phone for return or inspection upon resignation.
  • Consequences for disregarding job responsibilities and deadlines, like disciplinary action or termination.

Social Media

When it comes to developing policies surrounding social media, outline policies that apply to people who directly represent you on social media as well as expectations of employees on their personal accounts.


Ask yourself questions like:


  • Which employees are allowed to represent or communicate on behalf of the company?
  • When do employees need approval to post a message on social media on behalf of the company?
  • What kind of information are employees allowed to post related to their work on social media?
  • Should employees keep their company accounts and my personal accounts separate? If employees include company information on their social media bios, are there any additional expectations that come with this, like including a note that all opinions expressed do not reflect that of the company?
  • What procedures should employees take if customers contact them on their personal social media accounts?


Additionally, you’ll want to outline specific expectations of employees on their personal and professional accounts to help to mitigate risks to your business like creating policies around:


  • Behavior – Employees should be respectful, polite and patient, when engaging in conversations on our company’s behalf and avoid hateful, racist, or derogatory language
  • Disclosing confidential information
  • Affiliation or promotion of hate groups
    Promotion of other brands or suppliers related to company
  • Slandering the company during or after employment (e.g. social media, Google reviews)

Using Company Property

Include procedures and requirements for the use of company property including equipment, tools, and vehicles. You’ll want to detail what condition equipment should be returned in, consequences for damaging items, how items should be handled, and any paperwork employees need to complete when using equipment.


Here, you’ll want to include whether employees are permitted to drive company vehicles outside of work and any requirements, like a clean driving record and expectations.


Payment Schedule

You can find a list of state requirements for when you need to pay your employees here. Detail what happens if pay days fall on off day or company-observed holiday (e.g. employees will receive paychecks on the business day immediately preceding) or in the event of lost time, like weather-related emergencies. termination of employment.

Time tracking

For example, you may note that employees are not permitted to clock in/out for one another or they won’t be compensated for these hours. You would also want to detail any policies around clocking in late and how that may impact compensation or penalties for failing to clock in or adjusting timesheets without permission.

Payroll Deductions

There are a number of payroll deductions you’ll need to consider, like health insurance and required tax deductions (federal, state, local, social security, medicare, unemployment). When making payroll deductions, make sure you’re legally allowed to subtract this from employees’ pay and be sure to get signed consent from employees in order to make deductions.

Advanced Payment

If your company provides funds in advance for employees, you’ll want to outline which types of advances are available, what situations you allow financial advances and personal loans, how often, the maximum loan amount, and the terms of repayment. For example, you might give employees their paycheck early or give personal loans to employees for tool purchases and require repayment over a 3 month period.


If your business offers reimbursements for business related expenses, outline which expenses qualify for reimbursement, the amount, how they should be recorded, and how and when employees can expect to be reimbursed.


For any benefits like medical and dental, you’ll need signed agreement and to strictly adhere to the rules and regulations outlined by the companies providing these benefits to avoid legal issues.

Additional Pay

For any other additional pay, you’ll want to outline the terms and conditions of these payments including payment schedule, when employees are eligible to begin receiving these payments. This can include: commissions, tips, bonus pay, recognition pay, and any other non-cash benefits.

Discipline/ Termination

In this section, you’ll want to explain what disciplinary actions will be taken when employees violate the policies you’ve set out. Will employees get a verbal or written warning? How many warnings will they get before being terminated? What kind of actions can result in automatic termination? Be specific.


When outlining disciplinary actions, be sure to consult federal and state laws because some disciplinary actions like levying fines, requiring uncompensated overtime, or withholding final pay until company equipment is returned could be illegal depending on employees’ classification. Additionally, many state laws contradict federal guidelines. For example, some states require you to present the employee with their final paycheck during termination while in other states, they can receive their paycheck during their regular pay period.


Once you’ve finished establishing your company’s policies and procedures, it’s a good idea to compile them into an employee handbook that can be distributed among your employees and, if possible, get a lawyer to review the final version. Need a little help organizing your employee handbook? This guide can help you get started.

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