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Five Fatal HR Flaws
What not to include in your company's personnel policy manual
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Business New Haven
3/4/2002
By: Anne-Marie Brungard
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To be - or not to be? That is the hotly debated question today among human resource professionals.
Should your company codify its personnel policies in a formal manual? Even experts disagree wildly. Naysayers characterize policy manuals as the rope by which too many HR departments unwittingly hang themselves. Others concede that although lawsuits are here to stay, carefully crafted policy manuals ensure at least a modicum of protection for the company.
The San Francisco employment law firm of Littler, Mendelson recently reported that a large number of startups do not institute formal employee relations policies until they hit the 100- to 300-employee range. Yet recent court decisions reflect favorably on employer who make conscientious efforts to inform, train and take swift action in employee relations matters, confirming the importance of establishing written policies and procedures to minimize business risks.
When developing company policies, following are some items HR and employment-law experts says should not be included:
Any policy that does not reflect your organization's actual business strategies.
Personnel policies, like all human resource programs and processes, should be driven by your organization's overall HR plan, and ultimately by the company's business strategy. For example, if the company espouses a flexible work culture and allows individual managers to establish policy within their own departments, company policies should mirror these practices.
This may take the form of flexible benefit offerings such as a so-called cafeteria plan, which allows employees to choose individual benefits from a broader menu.
According to Mitch Stem of Deloitte & Touche's human capital group, “The best way to go about defining HR policies and procedures is to get an understanding of the organization's perspective on control vs. flexibility.” It is necessary to understand the broader business goals and the desired role of the HR function in attaining those goals. Additionally, it's important to determine the capability of managers in your organization with respect to communicating and enforcing policy. This will help you to understand whether HR will need to be a “policeman” or a strategic partner.
The HR professional has the important task of communicating company policy to employees. In the current economy, company policies can be a key factor in employee retention. So it's imperative that there's no “disconnect” between the company's goals and philosophies and what is articulated in the handbook. No matter what the company's size or industry, a statement of the company's vision and goals should be communicated in writing and available to employees.
Any language that implies a binding contract.
An employee policy manual is not a legal agreement. Written in clear language, under straightforward topic headings, a policy manual may describe hours of operation, employment categories, benefit programs, employee conduct, disciplinary procedures and many other topics. The policy manual is a narrative summary of the important rules and regulations of your company.
Whether it is a five-page general version or a 200-pager dripping with details, a policy manual should be accurate, legally compliant and consistently implemented. Consult an experienced attorney. Upon drafting the manual an attorney should review the document to verify legal compliance.
Too much detail on procedural issues.
According to the Internet resource Workforce.com, there are pros and cons to providing a lot of detail on specific procedures in the policy manual. It is an advantage to have a specific blueprint for workers to follow, although the manual is not the only tool to accomplish this. Policy manuals can damage the employer when published versions are inconsistent with actual practices. Grievance and internal complaint procedures are typical examples of provisions which can lead to serious problems if not followed consistently. If detailed procedures are to be included, they need to be diligently updated and communicated to appropriate supervisors and employees.
Policies that are likely to change over time are another area of concern. If they are included in the manual, there must be a method of updating and disseminating the information quickly. “If employees have outdated or differing versions of polices available to them this can be a real liability for the company,” says Ellen Pankey, managing director of Pankey & Associates in New Haven.
Two of the hot topics in manuals include privacy policies and use of email, voice mail, computers, software, Internet and miscellaneous electronic systems - usually included under the umbrella of technology policies. Here the detail required to meet your company's need should be industry-specific.
“If you have an e-mail, Internet or voice-mail policy, you may want to include in it a clause that reminds employees [that the company] has the right to review such communication tools,” explains Pankey.
Policies that are not company-, size- or industry-specific
These can include:
1. Policies required for all employers: Having even one employee will obligate the business to comply with these rules and regulations. Wage laws are one example. Federal laws will apply unless individual state laws are more stringent. Policy manuals are an opportunity to clarify such issues as how overtime, flex time or compensatory time is to be approved, scheduled and recorded. Meal and rest periods may be explained, as well as pay procedures and attendance record-keeping.
2. Policies required based on company size: One example is the Family and Medical Leave Act (FMLA) for companies with 50 or more employees. If the employer provides a policy manual, the FMLA entitlements and obligations must be included.
3. Policies required based on the company structure: Employers are not obligated to provide vacation and sick time, for example. If offered, policy manuals can clarify for employees such issues as benefit accrual, advance notice requirements and caps which may apply (e.g., lawful “no additional accrual” maximums rather than “use it or loose it” caps).
4. Policies that are industry specific: According to Workplace.com's Shari Randall, safety rules, which may be industry- or workplace-specific, are often included in policy manuals. A heavy parts manufacturer may include a requirement that employees wear steel-tipped shoes in its production center and also complete required training before operating forklifts.
5. Policies that are informational or supplemental: Diversity programs are one example of a volunteer effort a company may choose to undertake. Including this information in a policy manual makes the statement that it is important to the company and that the provisions should be read, understood and implemented.
Any language that could be construed to violate federal,
state or local regulations
Why leave your company exposed to potential lawsuits? State and federal legislation often contains model policy language that can be used in writing manuals. Policy provisions regarding sexual harassment, racial, age and pregnancy discrimination may be obtained through reproducible government sources.
Remember, too, that policy manual provisions are state-specific. Make sure you are aware of which state laws are included in policy-writing software, particularly when purchasing products over the Internet.
There is also a wide range of policy-writing software commercially available, and the better programs will offer checklists, pull-down options, references to applicable laws, customized formats, update services, ready-to-use tables of contents and indices, and online or intranet versions.
But beware, there are plenty of over-simplistic policy-writing packages on the market and others containing inaccurate information. Some of the best programs may also present so many policy options that the untrained user may obligate his/her company beyond what is recommended from a risk-management standpoint.
Finally, a do-it-yourself approach usually requires some assistance by a human resource professional and/or legal advisor to answer questions along the way and to approve the final version.
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