Thursday, November 13, 2008

8 common employee handbook mistakes, and how to avoid them

HR Legal News provides a list of its top common mistakes in employee handbooks. The following discusses some of the list, offers some tips on how to avoid common trouble spots, and adds a few more mistakes that should be avoided.
  1. Illegal overtime policies: For example – “All overtime must be authorized by a manager or supervisor and the company will only pay authorized overtime.” Such is policy is illegal if it is applied as written. All overtime, whether its authorized or not, should be paid. A better rule to control unauthorized overtime is to prohibit unauthorized overtime and discipline those employees who violate the rule.

  2. Vague FMLA language: The FMLA is rife with traps for employers who do not specify certain eligibility requirements. Otherwise, a company leaves itself open to be sued by otherwise ineligible employees. A handbook should also be clear on the interplay between FMLA leave and other paid leave policies, and to make sure that employees cannot double-dip by first exhausting paid leave before turning to unpaid FMLA leave.

  3. Bans on salary discussions: The National Labor Relations Act makes it unlawful for any employer, whether union or non-union, to interfere with, restrain, or coerce employees exercising their right to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection. One such protected activity is discussing terms and conditions of employment, such as wages. A policy that could be construed to prohibit discussions of wages or other terms and conditions of employment would violate the NLRA. A safer rule would limit confidentiality to information about corporate information and customers, and would not interfere with disclosure of information about employees’ terms and conditions of employment.

  4. Unnecessary probationary periods: Probationary periods are typical in union contracts, but have no place in a non-union setting. Such a policy is counter-intuitive to the at-will nature of the employment, and could set an unreasonable expectation of continued employment after the 90 days expire. A better policy would simply re-affirm that employees are at-will and can be terminated at any time for any reason, and that all new employees’ performance will be evaluated after 90 days.

  5. Too many details: A handbook should be a set of guidelines for the company to follow. It should not be intended to account for every situation that could arise, not should it be written in stone. Companies should write handbooks to leave enough flexibility to change policies when the situation dictates.

  6. Missing no-solicitation policies: These policies are necessary to try to limit union solicitations in the workplace, but cannot be specifically directed at union activities. Instead, companies can draw any reasonable line, so long as the line drawn is not specifically tied to union solicitations. Moreover, the rule should include the use of bulletin boards and corporate computer systems (e-mail, intranets, etc.).

  7. Lack of an at-will disclaimer and signed receipt: In litigation, a handbook is only as good as being able to prove that an employee received it on a certain date. The best proof is a signed, dated receipt in all employees’ personnel files, with enough information in the receipt itself to link it to the handbook (such as a date for the issuance of the handbook). Also, handbooks should clearly state that employees are at-will, that the handbook is not a contract, and that employees should not rely on any statements in the handbook. These simple measures will help protect against breach of contract and promissory estoppel claims.

  8. Missing Harassment Policy: An anti-harassment policy is necessary to take advantage of the Faragher/Ellerth affirmative defense. It is one of the most important policies a handbook should contain, and no handbook is complete without having such a policy.

Handbooks are a necessary evil in today’s workplace, but present myriad dangers for employers if they are not carefully drafted with a keen eye to legal compliance.