When reviewing your employee handbook, or developing a new one entirely from scratch - knowing what to include (and what to leave out!) can be extremely confusing. Most professionals without an HR background would not know where to start, and rightfully so.

We spoke with TPD's Lead HR Strategist, Elena Smith, and she outlined the benefits of having a comprehensive employee handbook, and how exactly you can get there:

1) What are the benefits of having a great employee handbook?

I prefer to call it an Employee Handbook rather than a Policy Manual, because ideally it’s a helpful guide for employees to understand what’s expected of them where they work.

When a new employee starts working in a company, the Handbook is probably one of the first pieces of company literature/documents they read. It explains company norms such as working hours, overtime, time off, social media and benefits, as well as a code of conduct on things like conflict of interest, and professionalism expected with clients and fellow employees.


Once an employee has passed the on-boarding stage, a handbook also protects them in situations like bullying and harassment or ending employment, by outlining clear steps that the company will take to deal with these situations. It also helps managers deal with situations that arise with fairness and consistency.

Probably most important is that the employee handbook will significantly reduce your legal liability because it demonstrates that you are proactively managing your people in a consistent and compliant way.  

2) How can your company culture shine through the employee handbook?

A great Employee Handbook is a showcase for your employer brand. It’s your chance to blow your horn about why your new employee is lucky to join your team, using language that reinforces the culture and tone you want in your organization.

At TPD, we like to do on-line Employee Handbooks because they can be visually engaging and allow you to keep the tone positive and gear your policies towards your 90% good employees. For the 10% of non-performers, you can provide links that lead to more detailed disciplinary processes and procedures.

3) How often should you be updating it?

In a perfect world, your Employee Handbook would be kept current, adding new policies as situations arise that need clarification.

At minimum, it should be reviewed annually to ensure any current employment regulations have been updated. Record the date of the last update each time you make a change. You’ll also want to include a clause stating that you are entitled to make changes and updates to the Employee Handbook at any time.

4) How can you ensure that employees actually read and understand it?

A statement of understanding should be included at the end of the employee handbook. It provides documentation that the employee has read, understood, and agreed to the organization’s policies. This approach is particularly recommended where contravening the policy could result in harm to the employee (e.g., requirements to wear protective equipment when working) or where disciplinary measures could result from not following the policy (e.g., harassment).

There should be a plan for consistently, ensuring that all current and new employees receive a policy orientation and sign a statement. You should also do this each time there are significant updates to the policy.

5) What are some aspects you often see missed in employee handbooks? 

• Sexual Harassment Policy
• Dress Code Policy
• A Carefully Defined Work Week
• Overtime policies and restrictions  
• Sick days
• Not allowing a lawyer to evaluate the handbook
• Failing to update your handbook regularly
• Not properly introducing the new handbook to current employees
• Failing to give all employees a handbook

6) What's a common employee handbook issue you've had with clients?

The most common thing would be regarding the lack of termination clause and severance pay in the employee handbook. The termination clause will typically provide the employee with either a fixed notice period or a formula for calculating the notice period based on the employee’s years of service.

The termination clause will also specify what benefits and variable compensation (in addition to base salary) will be continued during the notice period. It is important for employers to insert termination clauses into their policy manual to reduce their cost of terminating the employment of their employees. A termination clause does have the benefit of providing certainty regarding an employee’s entitlements upon dismissal.

7) Can you outsource the creation of an employee handbook? 

Yes! An Employee Handbook is notoriously a work-progress that sits to the side of the desk and never quite gets completed, so it's a great project to outsource and cross off the list.

The important thing is to make sure that the manual has a personal tone that reflects the expectations, tone and culture of your organization. We typically spend about 4 hours with the key client stakeholder discussing your current norms - what works and what doesn’t. It typically takes about 6-8 weeks to complete an Employee Handbook, depending on client availability and responsiveness.

8) Newer policies that companies might consider adding?  

Employers should consider including a flexible work arrangement policy. This would define the types of job flexibility (i.e. flextime, telecommuting, compressed workweeks) that you would be willing to offer on a fair and consistent basis. It would also detail which employees would be eligible based on your business needs and work environment.

Should you choose to include a flexible work arrangement policy - Remember that you must also outline a request and review process for it. This would be a set of procedures in place regarding how proposed flexible work arrangements gain approval, including steps for employees and management to follow.

Other newer policies I see coming up frequently are employee referral programs, or employee volunteer programs - Both are excellent additions!

Want to ensure all your bases are covered with your organization's employee handbook? Check out one of our FREE resources below!