An employee asked for a personal day and you approved it. A month later, another employee asks, and you are unfortunately short staffed, so you have to say no.
There may be a good reason for the different answers. But if employees don’t understand how those decisions are made, they’re left to draw their own conclusions.
This is one reason an employee handbook matters, even for a small business.
During MegaPay’s Workforce Compliance Webinar, employment attorney Chaim Book of Book Law LLP explained why he recommends having one:
“Where you don’t want to be is where you just make it up as you go along.”
When you’re busy running a business, it might seem easier to just handle each request as it comes in. Over time, it may become difficult to remember what you approved, what you told an employee, and if you’re being fair by following the same process for everyone.
There is no federal requirement for private employers to have an employee handbook. Please be aware though, there may be specific written policies and notices that are required. This can depend on your type of business and where your employees work.
As an example, New York requires every employer to have a sexual harassment prevention policy. As an employer, this is your responsibility whether or not you have a handbook.
Chaim described the distinction simply: “Some policies are required by law. Some policies are just smart to have.”
A handbook brings your policies together so your team have somewhere to go when questions come up. It doesn’t replace separate requirements for training, postings, or notices.
Because you’re likely the person making most of the decisions.
Who should an employee notify when they’re sick? How far ahead should they request vacation? What happens when someone repeatedly arrives late?
You may know how you want these situations handled. Your employees, or the supervisor you just promoted, may not.
Writing down the process gives them a reference to rely on. You can still consider individual circumstances and any legal obligations, including accommodations. The goal of a handbook is to get you to an established policy, instead of trying to remember what happened last time.
Chaim also noted that inconsistent treatment can lead employees to question whether they are being discriminated against. That said, your handbook can help explain what's expected, but your actions need to support what’s written down.
A template can be a great starting point. Read it carefully before putting your company’s name on it though.
During the webinar, Chaim recalled reviewing a handbook that included 23 vacation days, separate from other time off. The owner hadn’t realized that it was there.
That’s an expensive detail to overlook.
A borrowed handbook may also be written for a different industry, state, or employee count. Even another company in your industry may have obligations and benefits that don’t match with yours.
Before distributing a handbook, check that you understand its contents, can follow its procedures, and have had it reviewed for any legal requirements.
For help identifying topics to include, see our blog, “7 Must-Have Policies in Your Company Employee Handbook.”
Give employees access and document that they have received it. Chaim recommended a signed acknowledgment of receipt during the webinar.
Managers need to read it too. If your handbook describes one process while supervisors follow another, employees will understandably be confused.
Written policies may also help support an employer’s defense if a dispute arises. But Chaim was clear about their limits: “Is it a complete defense? No.”
For a small business, the value starts much earlier than a lawsuit. It’s being able to answer an employee’s question with confidence, explain a decision, and follow through on what you told your team you would do.
Your handbook should change as your business does. Adding a benefit, hiring in another state, or changing how employees request time off are all reasons to revise it. Have updates reviewed for applicable requirements and make sure employees and managers receive the latest version.
If you’re handling HR on top of everything else, you don’t have to figure it all out yourself. MegaPay’s fractional HR service provides ongoing guidance without the need to hire a full-time HR employee. Contact our team to discuss your current policies and where you could use support.