The Top 5 Reasons Why an Employee Handbook is Critical for Your Business

Posted on Tuesday, February 4th, 2020.

The Top 5 Reasons Why an Employee Handbook is Critical for Your Business

by Paul Salvatoriello, Esq.

February 3, 2020

Have you heard the old adage that you are more likely to get something done if you take the time to write it down?  Well, the same holds true for your company’s policies.  Writing down your company’s policies in an employee handbook will pay dividends in efficiency and peace of mind in the long run.

If you run a business with between five and 100 employees, then you likely feel that your operation is small enough to rely on “institutional knowledge” with regard to company policies.  That is an understandable notion, but we invite you to read on.  There are immense benefits to having an employee handbook, even for small businesses.

As business-side employment attorneys in NJ and NY, we have seen time and time again that businesses run into significant legal issues, and sometimes costly litigation, because they lack a formal employee handbook, or failed to update an employee handbook that was far out of date.  Avoid those costly pitfalls by putting your company’s policies down in writing today.

In this blog, we will take a moment to discuss with you the top 5 reasons why an employee handbook is critical for your business.  If, after reading this blog, you would like to find out more about whether an employee handbook is something you want for your company, then we welcome you to contact Trimboli & Prusinowski LLC, the experienced employment law attorneys in NJ and NY.  You can call us at 973-660-1095 (ext. 150), or fill out our online contact form, today.

Reason #1 – Defending Your Company from Employee Lawsuits

The worst-case scenario for a lot of companies, small businesses in particular, is when an employee takes his or her claims to court and sues your company.  As you know, regardless of the merits of a claim, the costs of litigation are financially draining for your business.  Moreover, if there is any uncertainty as to what policies and procedures were part of your company’s operations, then the litigation can become that much more costly and contentious.

In our experience, the very first item of documentation that will be requested in an employment matter is the company’s employee handbook.  Without a handbook, the absence of a handbook will be used as proof that the company did not have consistent policies or procedures.

Thus, having a regularly updated employee handbook is vital to defending your business from employee lawsuits.  When a claim arises about overtime, discrimination, or harassment, the fact that your company has a written policy will go a long way to minimize the issues that need to be litigated.

Reason #2 – Set the Blueprint for Employees and Managers

An employee handbook is the “operator’s manual” for your company or small business.  It serves an important role in setting expectations for all employees, including all management personnel.  It is also a great tool for new employees because it clearly communicates the tone, the culture, the environment, and the rules that keep the company going strong.

It is not an understatement to say that putting policies down in writing has the effect of giving those policies more importance and making them more likely to be followed by all employees.  Accordingly, you would be wise to have a business-side employment attorney draft an employee handbook so your company has a solid blueprint upon which to build an enjoyable and productive workplace.

Reason #3 – Justice for All

In any group setting, there is always a danger that some people might feel that they are being treated unequally or unfairly compared to others.  That danger only increases in a company that operates with unwritten rules or goes by “institutional knowledge” alone.

An employee handbook, which sets down on paper the proverbial “rules of the road,” serves as a comfort to all employees that everyone will be treated equally.  The notion that there is one set of rules under which all personnel must abide makes it much easier to prove that your company provides a fair, equitable workplace.

Reason #4 – Communicate Company Benefits

It is often a challenge to convey the numerous health benefits, 401k benefits, and other programs that your small business has to offer when there is no handbook.  Consequently, an employee handbook is a perfect way to have all of the company benefits put in one place, and in a manner that is organized and easy to read.  Your human resources person will be happy to be able to refer employees to one handbook that explains it all.

Reason #5 – Ensure Compliance with State and Federal Law

Finally, your company’s employee handbook will reiterate to all employees that your company is committed to following all applicable state and federal labor and employment laws.  In fact, New York State has recently mandated that companies of a certain size have a written policy with regard to sexual harassment.  An employee handbook is the ideal vehicle to convey those policies and notices required by law.

Employment Attorneys in NJ Can Draft an Employee Handbook for Your Company or Small Business

At Trimboli & Prusinowski, LLC we have helped many companies and small businesses draft and update their employee handbooks to ensure that they maximize productivity and minimize legal issues in the future.  Let us help you do the same.  We are business-side employment attorneys in NJ who are ready to give your company the benefit of our experience and resources.  Call us at 973-660-1095 (ext. 150), or fill out our online contact form, today.

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