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Why Is An Employee Handbook Important For Your business?

Rayaan Shire 01 Oct 23:10 7 min read
lady standing in meeting with document

An employee handbook is the most crucial document of any company. It outlines a company’s vision, mission and way of operating. It also allows your company to be transparent and open regarding discrimination, favouritism and harassment, along with giving all the information needed to report any violations on such issues.

You must take the time to understand why you should have an employee handbook and know how to write a practical employee handbook that your employee will enjoy reading.

What is an Employee handbook?

You might have heard of employee manuals, policy and procedure manuals, company policy manuals, staff handbooks; these are all some of the different ways a handbook is known. Still, they all essentially mean the same thing. An employee handbook highlights all the relevant employment and work-related information that employees need, and it is a book given to employees.

In most cases, an employee handbook has a similar structure that follows a set of three categories, and you can expect to find these in all good employee handbooks. The following are the categories;

  • Information about the company - Normally, these handbooks will have the general information, a mission statement, and company values.
  • General helpful information - you will find company policies and procedures, all details employees need to know about the workplace, and holiday arrangements and company perks.
  • Specific important information - you should find information about company rules, disciplinary and grievance procedures, and any other details regarding employment laws or regulations.

Ideally, an employee handbook is given as part of the company’s induction process for new staff members, the exact way a contract is.

Why Should you have an employee handbook?

Firstly, there is no law requiring companies to have an employee handbook and that you are not legally obliged to have one.

However, Gusto’s research found that 87% of small businesses sized 10-200 have an employee handbook.

Now, you might ask why the majority of companies choose to have a handbook?

Simple: A company handbook compiles all the necessary knowledge about the operation and system in a manual that can be easily referenced. Having an employee handbook affects many aspects of your business and positively impacts your business bottom line.

There are many benefits to having a handbook, but here are the topmost essential benefits of having an employee handbook;

1. Introduces employees to your culture, mission and values

The central aspect of your employee handbook is introducing new employees to your business culture and how they will fit in. A manual is much more than a list of policies, rules and regulations. A well-done employee handbook communicates your organisation’s mission, vision and values, therefore outlining your company’s culture.

2. Communicates to employees

The handbook outlines an employee’s general responsibilities regarding safety, reporting and timekeeping. It acts as a compass for the company’s policies and procedures. It will explain all the details about whom employees must contact when they have unscheduled absences and the timing.

For these policies to be effective, it needs to be consistent.

3. Time-saving

A well-written employee handbook provides solutions to the most often asked questions of employees. You can avoid constant policy queries by maintaining an employee handbook. Employees will be able to find the answers on their own, which will save you time.

4. Improved onboarding

Employee handbooks are particularly helpful for new employees who have recently joined your organisation. An employee handbook is a valuable tool for onboarding new employees because it assists them in orienting themselves and getting up to speed more quickly.

5. Prevention of legal dispute

In the event of a legal conflict, having your policies laid out for all of your employees helps as legal protection. A practical employee handbook outlines your employment relationship explicitly, providing necessary legal protection for your business.

6. Formalised policies

You must establish your business and employee policies and processes before you can write your employee handbook. Writing an employee handbook will assist you in formalising and organising your company’s policies by centralising them.

How to write an employee handbook?

Before beginning to write an employee handbook, business executives must first understand what is required by law. Also, this can influence how you put up the staff handbook.

There is no magic recipe for writing an employee handbook; you should do what works best for your staff! However, there are a few things to include in your manual. The following are some of the things you can have;

  • Your company’s mission, vision, and an overview of its culture
  • Guidelines for employee conduct
  • Details on legal aspects of employment
  • Summaries of perks and benefits
  • Descriptions of company processes and procedures
  • Holiday entitlement and conditions
  • sickness/injury payment and condition
  • General information

When should a company create an employee handbook?

Many businesses decide to establish one because they can help to reduce internal friction between employees. Ideally, a handbook needs to be created at the start of a business, but it is never too late.

Each company’s exact point is different, but if you think your small firm is approaching the stage where conflicts are likely to arise, it’s generally a good idea to create a handbook.

What not to include in an employee handbook?

There are numerous rules and recommendations for what should be covered, but do you know what not to include in your employee handbook?

Policing that is overly complicated or outdated.

It’s critical to make policies transparent and straightforward if you want people to obey them because it is impossible to anticipate every eventuality that may emerge.

If all of the steps in a method are critical, make sure you write them down. Include specific instructions on how you want things done.

Disciplinary proceedings that are harsh

While it’s crucial to spell out protocols for dealing with disciplinary issues, managers should be given leeway in unusual circumstances, especially if it is an employee’s first transgression.

Implementing an employee handbook acknowledgement form is also a fantastic idea. Employees should be aware of behavioural and professional expectations for disciplinary action to be effective.

Promises implied

It’s worth noting that referring to the first 90 days as a “probationary” phase is less common now than it was in the past, as it dismisses the concept of willful employment. The first 90 days should be referred to as an “introductory period” or something to this effect.

Putting together an employee handbook can be a daunting task. Keeping track of what not to include in your employee handbook should help you simplify the process and better grasp employee rights vs employer needs and regulations.

Who should write an employee handbook?

In most firms, HR is in charge of the employee handbook. It makes perfect sense, given that the HR personnel is familiar with and understands the relevant company's policies. An employee handbook in smaller organisations that do not have a professional HR team. Small-business CEOs, for example, frequently write their staff handbooks.

Another alternative is to create your staff handbook collaboratively. How do you go about doing it? Make the initial draft of your employee handbook and enlist the help of all your employees. Simply give the first version to your staff and ask them to provide feedback and suggestions for improvements. It’s a crucial step in establishing an open, collaborative team culture in your organisation.

It is recommended that a legal professional double check your completed handbook to ensure that everything is how it should be. It’s vital to ensure you choose a legal counsel that is an expert in employment law.

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