Why Do I Need An Employee Handbook?

Although there is no federal law requiring private employers to provide handbooks to their employees, there are numerous reasons for employers to do so, including:

• Providing an opportunity to formally welcome new employees, introduce the organization and explain expectations;
• Grouping various employment policies together in a handbook makes it easier for an employer to ensure that each employee receives copies of all relevant policies;
• A handbook is a centralized place for employees to look for answers to common questions and,
• Handbooks that include signed acknowledgments can assist in an employer’s legal defense.

When drafting an employee handbook, it is important to understand that handbooks are often considered contractual in nature. In New Jersey, an employee handbook can create an enforceable contract if there is no clear and prominent disclaimer that employment is at-will. Absent this disclaimer, a handbook could lead a reasonable employee to believe it creates a contractual obligation based on several factors, including the definiteness and comprehensiveness of the termination policy and the context of the manual’s preparation and distribution. Additionally, employers should recognize that handbooks often become an exhibit in any employment-related litigation or administrative proceeding. Therefore, it is imperative that policies in handbooks comply with federal, New Jersey and local law, demonstrate an employer’s commitment to comply with the law, and accurately reflect the employer’s actual employment practices.

Solution: Employee Handbook Checklist

1. Identify Federal, New Jersey, and Local Laws Applicable to the Employer

The applicability of various federal laws depends on the size of an employer’s workforce. For example, the anti-discrimination provisions of Title VII of the Civil Rights Act of 1967 (“Title VII”) apply to private employers with 15 or more employees. The leave protections under the Family Medical Leave Act of 1996 (“FMLA”) only apply to employers with 50 or more employees.

In addition to federal law, handbooks must comply with the law of each jurisdiction in which they will be used. Common areas in which state law may impose different or additional obligations on employers include: minimum wage and overtime requirements, leave requirements, and types of protected classes.

Lastly, some cities and counties impose additional obligations on employers. For example, 13 New Jersey Municipalities have enacted paid sick leave laws. These local laws should be reflected in the handbook’s provisions.

2. Ensure Essential Disclaimers are Included in the Handbook

The at-will provision should inform employees that they are employed on an at-will basis and that nothing in the handbook is to be construed as creating a contract of employment. Additionally, employers must ensure that there is a provision stating the employer’s ability, without notice, to unilaterally revise, rescind, or modify the provisions and benefits described in the employee handbook, except for the at-will provision. Finally, the handbook should include an acknowledgment form for employees to sign and return to the employer. The acknowledgment should state that the employee a) received the handbook; b) read it, understood it, and agrees to comply with its provisions; and c) are employed on an at-will basis

3.Review the Handbook’s Policies and Procedures

The policies and procedures in the handbook should be consistent with the employer’s actual practices. Any ambiguities will be construed against the drafter. Therefore, it is important that any wording that is unclear or confusing be revised and that the employer follows the policies set forth in the handbook in a consistent manner.

While anti-discrimination, harassment, and other policies are not required to be included in an employee handbook, many employers include them to demonstrate compliance with these laws and to communicate that commitment to their employees. Moreover, these policies should also identify protected classes under New Jersey and local laws and include a clause to that effect. For more information concerning specific policies, including but not limited to wage and hour, employee conduct and expression, and employee leave, please contact our office directly so that we may further assist you with your specific needs.