Policy Manual Blunders

Like all good employment lawyers, I encourage my clients to have an employee policy manual that outlines, among other things, the company’s expectations regarding employee performance, explaining the available benefits, setting guidelines for using the company technology and prohibiting harassment, violence and drug abuse.

I regularly draft new policy manuals for my clients or review and revise their old manuals. There are several serious blunders I often run across in the employee handbooks I review. If you are a business owner or supervisor, pull out your handbook now, blow the dust off the top of it and crack it open to see if you have made similar mistakes in your manual:

  • Prohibiting employees from discussing their salaries. Most of us would like our employees to keep quiet about the topic of money. However, your employees’ right to discuss their salaries is a first step in allowing employees to consider unionizing. Therefore, the National Labor Relations Act states that an employer cannot prohibit employees from discussing compensation because such a rule has a chilling effect on employee efforts to organize. Don’t worry, very few unions are active in the Texas Panhandle and the chances of your workforce voting to organize are slim. But don’t hand anybody an excuse to complain about your practices by including the salary discussion prohibition in your policies.
  • Using the words “good cause” anywhere in the handbook. Texas is an “at will” employment state, meaning that you can have good cause, bad cause or no cause at all when you fire someone. Of course, any wise employment lawyer will advice you that having good cause will go along way towards protecting you from employee lawsuits, but don’t promise that in writing. Just because you intend to use common sense and basic fairness when you fire someone doesn’t mean that you always will, so protect yourself by striking the words “good cause” and emphasizing “at will” throughout your manual.
  • Failure to address issues that are relevant to today’s technology-dependent work environments. Do you let your employees know not to expect privacy with their e-mails sent from work? You have a right to screen them, you know, and to protect your other employees from identity theft, sexual harassment, breach of confidentiality and other concerns you may have to screen them at some time. What about cell phone cameras, ear buds connected to I-pods, GPS monitoring of your salespeople, downloading of confidential documents, gossip about the company online in blogs, etc. There are enough issues to make your head spin with today’s technology. But the wise employer addresses these issues quickly and thoroughly in the employee policies.
  • Using taboo words. You know lawyers. We believe in “magic words”. That’s why every disciplinary writing should contain a warning that the employee “may be subject to disciplinary action up to and including termination.” At the Texas Workforce Commission’s unemployment hearings and in court, those are magic words that can turn the case towards a victory for the employer. On the other hand, there are other words in employment policies that can make the employer’s case disappear faster than the twitch of Samantha’s nose. Those are words like “permanent employee”, when what you really mean is “regular employee.” As I’ve said before, “good cause” is taboo. So is “annual salary” in any offer letter or other communication with an employee (break it down by hour, week or month). Stay away from “authorized overtime” also. You have to pay all overtime whether you authorize it or not. Your only option is to explain the working hours to the employee and discipline him through warnings and eventual termination if he exceeds those hours.
  • Making promises to employees that you don’t have to make. These promises can provide benefits and rights you did not mean to provide your employees or don’t have to provide. For example, in Texas you don’t have to pay for unused vacation time when an employee leaves your company. So why promise it? You’ll be mad at yourself if an employee embezzles money from your company and yet you have to pay her two weeks vacation when you fire her. Other innocent sounding but vague statements such as “We are committed to fair treatment of our valued employees” can also give you heartburn later. Remember your right to fire someone for good cause, bad cause or no cause at all? Do you really want to be judged on your “fair treatment” of that annoying employee to whom you couldn’t resist saying “Good riddance”? No, you want to exercise your at will employment prerogative. Don’t limit that by trying to be “nice” in your employee handbook.

There are a million other little things I look at when I review an employee policy manual. Have you addressed what happens when an employee gets a speeding ticket or gets in a wreck while running a company errand during the work day? Have you updated your Family and Medical Leave Act policy to reflect the addition of military leave as required by legislation enacted earlier this year? Do you tell your employees that they have to report harassment, retaliation and discrimination and list to whom they are to report such problems? This can prevent a discrimination lawsuit from sneaking up on you months down the road, even after the employee has left your company.

Feel like you can’t possibly stay on top of all of this? That’s okay. You aren’t supposed to. That’s what your employment lawyer is for.

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