MAY 2017 – Top 10 Employee Handbook Mistakes

Top 10 Employee Handbook Mistakes

By Jennifer Brown Shaw and Alayna Schroeder

Done right, employee handbooks serve multiple functions. They provide employees with important information about the company, its practices and the working environment. They also help protect employers legally by setting clear expectations that employees must comply with. Done wrong, employee handbooks can do more harm than good.

Policies that are too specific and rigid can potentially limit an employer’s flexibility when dealing with real issues. Policies that are too general make it difficult for employers to hold employees accountable for their actions.

  1. An Overly Detailed Discipline Procedure

Some employers like to include a detailed discipline procedure in the employee’s handbook, specifying what disciplinary steps they will take if an employee violates company policy or does not meet performance standard.

Unfortunately these discipline procedures are often too detailed and constricting to address with workplace realities.

If an employer has a policy of employment at-will –that is, that termination and everything leading up to it can happen for any reason that is not legal –then the employer has no obligation to provide specific discipline procedure, much less explain it in detail.

Instead, the employer can handle disciplinary issues as they arise, maintaining consistency by centralizing discipline functions.

To avoid confusion and maximize flexibility, an employer should specify that violating any company policy – even on not state in the handbook – has the potential to lead to discipline.

  1. Not Controlling Meal and Rest Periods

California employers are all too aware of the potential financial impact of denying employees meal and rest periods. However, however many employers address breaks by only generally promising to comply with the law without explaining what that means. The California Supreme Court set forth specific standard for meal periods. Employees should be advised that if anyone interferes with their ability to take their required meals and rest periods they must notify their supervisor immediately.

  1. Not Controlling Overtime

Unauthorized overtime can create significant liability for employers. Overtime policies should be structured to limit unauthorized overtime. First, employers should define the “workweek” for purposes of calculating overtime. The overtime policy should also specify that employees are not permitted to work overtime without prior supervisory authorization. Though an employer can’t refuse to pay an employee who works unauthorized overtime, the employer can discipline employees who fail to follow specific directive not to work overtime without permission.

  1. Improper Deductions and Proper Reimbursements

Some employers make a big mistake not only in making improper illegal deductions from a paycheck, but also in reflecting that practice in their handbooks. Policies that state that salary advances or loans will be deducted from and employee’s final check violate California final pay rules.

  1. Putting a Cap on Medical leaves

Under the federal Americans with Disabilities Act (ADA) and California Fair Employment and Housing Act (FEHA), employers may be required to permit an employee with a disability to take time off if doing so will allow the employee to recover and return to work. Few employers are aware that a policy imposing a “cap” on the amount of leave provided for this purpose can create legal problems.

When deciding how much leave is appropriate, the ADA and FEHA require an individual assessment. Employers can limit the possibility of problems with federal and state agencies, or employee law suits by maintaining flexible leave policies that make clear each situation with be individually evaluated.

  1. Use it or Lose it Vacation Policies

In California, vacation and paid time off is considered a vested wage. In other words employers can’t take accrued vacation or PTO away from employees. Employers can’t encourage employees to take vacation with a “use it or lose it” policy.  Instead vacation policies should be written to allow accrual up to a maximum, with no additional vacation accrual once and employee reach the maximum. If an employee’s accrual falls below the maximum, then he or she begins accruing vacation again. The maximum should be a reasonable amount. The Labor Commissioner has state that one year’s worth of vacation is not reasonable so employees should be permitted to accrue more than a year’s worth of vacation.

  1. Overly Broad Electronic Communications Policies

Many workplaces today employees need access to e-mail, the internet and other methods of electronic communications to do their job. To control potential problems some employers specify that electronic communications systems can be used only for business purposes. However, the federal National Labor Relations Board has taken the position that an employer’s rigid policy prohibiting the use of its electronic communications system for any non-business purpose may have the effect of “chilling” union organizations. Therefore a policy on electronic communications should not entirely prohibit use of electronic systems for non-business use.  The policy should communicate that employees do not have a reasonable expectation of privacy in documents and other communications.

  1. A Rigid Harassment Prevention Policy

A written harassment, discrimination and retaliation prevention policy is a must-have for all employee handbooks. It helps employers defend claim of harassment when employees fail to follow the company’s internal processes for reporting potentially harassing behavior.

A written policy is required as part of an employer’s affirmative duty to take reasonable steps to prevent and promptly correct discriminatory and harassing conduct. Employers should not focus so much on “unlawful” harassment, or use an overly legal definition of “harassing conduct”. The employer should define “harassment” using a stricter standard than the actual legal definition. A policy could define harassment as “disrespectful or unprofessional conduct based on a protected characteristic, such as, sex, race or national origin.” Supervisors must be instructed to report complaints of misconduct to a designated company official so that the company can try to resolve the claim internally.

2          Over-or Under Acknowledging

Employers can and should request that employees acknowledge receiving and reading the handbook. Most importantly an acknowledgement is a key place to reiterate a concept that the employer should have communicated many times; employment at-will. That means either party can end the employment relationship at any time, for any reason and with or without notice.

1         Not Reviewing/Revising the Handbook Regularly     

Employment laws change frequently. Though not every change necessitate a new version of a handbook the document should be reviewed regularly so policies can be amended or updated when appropriate.

An employee handbook is an important document that can protect an employer from liability.