The Importance of Employee Manuals

posted in: Policies 0

Recent trends in Montana and federal law are making employee manuals more important than ever. Courts are reading them in wrongful discharge cases and expecting employers to follow them; businesses that don’t follow their policies are at fault even if the discharge wasn’t otherwise wrongful. Not having a manual means that you don’t have to worry about not following it, but then you leave it up to the courts to decide what you should have been doing – and you had better be paying attention to court cases if you want to take this chance. You also give the employee suing you the chance to say what your policy was.

In the long run, it is easier to have a good employee manual and keep it up to date. If you haven’t looked at yours in at least a year, now is the time to review it. Make sure all the polices reflect what you actually do, not a nice vision of what you would like to do someday. If you can’t implement a policy, don’t put it in your employee manual. For the mandated policies, like EEO, be sure you are following them. Add all the policies that have been taped to walls and sent out in emails, so they are all in one place. Check that your policies are consistent with each other.

Make sure your manual gives you flexibility; don’t back yourself into a corner. For instance, don’t say that you always do annual reviews on the anniversary of the employee’s hire; what happens if you have a personal or business crisis that week – or month? Instead, state that annual reviews are generally done around the anniversary of the employee’s hire, unless precluded by business contingencies. That way, the employee knows when to expect a review and you have flexibility to run your business.

Make a note to review your employee manual annually, or whenever you have a major change in your business. It probably won’t need to be updated every year, but a review gives you a chance to catch problems before a court looks at them. And keeping your manual up to date makes it much more useful for managing your company.


Thanks for Jill Gerdrum for a great presentation!