Many employers have been counseled by human resource professionals to create and provide employee handbooks. While the use of employee handbooks may provide substantial benefits for employers, they should also provide maximum flexibility for the employer in the management of its business and avoid making unnecessary promises and creating unintended obligations.
While employee handbooks may be an efficient method to convey management policies and expectations, the handbook and related materials must make it clear that they are not a contract of employment, do not create employee rights of entitlements and do not change the employee’s at will employment status. Appropriate and numerous disclaimers should reinforce the purpose and limitations of the handbook, as well as clarify that any employment agreement can only be modified by a writing signed by both the employee and the appropriate corporate officer. The handbook should help avoid claims of implied contract terms, promissory estoppel, wrongful discharge and breach of the employment agreement.
The employee handbook should also avoid making promises or representations that an employee can try to enforce against the employer, including: promoting and hiring from within, disciplinary stages before termination, length of employment, payment of competitive wages, annual reviews, raises based on performance, and that all employees will be treated fairly. While these goals may be management’s intent, stating them in an employee handbook may create legally binding obligations and limit management alternatives.
An employee handbook is for the employer’s benefit. While it can convey broad policy issues to employees and aid in an employer’s defense to certain claims, like sexual harassment, regulatory sanctions and employee criminal conduct, it should not become an employer liability.
Brooks, Tarulis & Tibble, LLC represents numerous business owners and employers, and can assist you regarding employee handbooks. If we can assist you in this regard, please contact