Ask Nancy: Are there disadvantages to having an Employee Handbook?

November 26th, 2009

In the last issue of “Ask Nancy” we dealt with the benefits of companies employing the use of employee handbooks. Generally speaking, employers land on the side of utilizing handbooks to establish policies and procedures and reduce the chances of unintentional discriminatory or illegal behavior.

The disadvantages to having a handbook, however, include the threat that the handbook forms the basis of an employment contract and/or it limits the company’s managers to handle situations on a case-by-case basis.

Employers who use a handbook can reduce the likelihood of it being used against them by having a prominently displayed disclaimer included. Although such a disclaimer cannot guarantee that a disgruntled employee will not sue for breach of contract or wrongful discharge, it can be a deterrent against such claims, as well as a helpful defense to companies when claims are brought against them.

The disclaimer should state in simple language that the handbook is not intended to create an express or implied contract of employment. It must also state that all employment with the company is “at will.” This means that either the employee or the employer may terminate employment at any time for any reason, with or without notice. In addition, the disclaimer should state that the handbook is not intended to be a complete description of the company’s policies or practices and the company reserves the right to revise, supplement, suspend or discontinue the policies at any time.

As with all things in HR, companies must be cognizant that even a well-intentioned practice such as utilizing employee handbooks has to be tempered with protecting the organization from legal risk and exposure.

For more, see www.cbia.com/HR/HRIssuesAndLaws/YourEmployeeHandbook.htm

Posted in HR and Management Tips | 12 Comments »

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