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An employee handbook is given to new employees from the employer. The handbook is used to inform employees about their job duties and expectations set by the employer.

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What is an Employee Handbook: What is it?

An employee handbook should detail the rights of the employee, as well as the legal obligations of the employer. Other subjects that may be covered in the handbook include dress code, compensation policies, the amount of sick time or paid time off available for employees, and additional employee benefits.

The employee handbook serves to protect both the employee and the employer. It makes the expectations of both parties very clear. This helps to prevent legal disputes between the two parties. In order to ensure an employee has received a handbook, they may be required to sign an acknowledgement form.

What Is An Employee Handbook?


What is an Employee Handbook

“A bunch of pages!” shouts the peanut gallery. Yes, yes, very funny.

In truth, the employee handbook is one of the most important documents you will create as an entrepreneur. It is your and HR’s go-to resource for resolving disciplinary matters. And since it is required reading for your new employees, it’s the one document you can rely on to whip them into shape.

Let me break that down into greater detail. An employee handbook is, or should be, all of the following -

Your company’s constitution

Yes, I do realize how dramatic that sounds. However, it’s a fair description. Your employee handbook is your number one resource for dispute resolution, intra-employee mediation, and performance review. HR will use it, employees will (or should) use it, and you will refer to it as needed when revising policy or developing your company’s infrastructure.

The foundation of your workforce

What kinds of employees do you want working for you? Employees who perform the way you want them to, of course. The employee handbook is a handy definition of what an ideal employee is and what standards your current employees should strive for.

Protection against lawsuits

Items such as the disclaimer, the non-contract clause (stipulating that receipt of the handbook in no way guarantees employment) and the assumption of your right to change employment policies at will grant you the status you need to keep things running smoothly. Other policies, such as the sexual harassment policy, non-discrimination policy and termination policy, dictate what is and is not okay, and releases you from liability should unsavory events occur within your staff.

A window on your corporate culture

It’s true that many employee handbooks read alike. This is because many busy entrepreneurs copy from an employee handbook sample or make lazy work of free employee handbook templates they have downloaded from the internet. Templates and samples can be very useful tools; however, when using them take the time to customize your employee handbook’s tone and provisions to suit your corporate environment . What kind of image do you want to promote, anyway? Design your employee handbook keeping your ideal boss-voice in your mind. Do you want to intimidate your employees? Do you want to discipline them right off the bat? Or do you want to project a more casual, congenial image? The tone, as well as the content, of your employee handbook can say a lot about who your company is and what you value.


The Main Components of an Employee Handbook

To ensure that your business runs smoothly, each new employee should receive an employee handbook. If you haven’t fully developed rules and policies for your company, now is the time to do it. You don’t want to forget any details when you’re laying out the following main components of your employee handbook.

Brief history of the company

This doesn’t have to be a novel. Tell the success story of your company in a few concise paragraphs. Describe the background of each of your founding members, the way it all got started and your company mission. The goal here is to inspire employees’ faith in the company and to make them excited about joining your corporate culture.


This is the real meat of the employee handbook. Lay out all policies that employees should A: internalize or B: be able to refer to throughout the course of their employment. If you want to be able to enforce your policies , your employees need to have access to them. It’s a good idea to be a bit nitpicky – you don’t want to leave anything out. Here are a few policies included in most employee handbooks -

·         Equal Opportunity and Non-Discrimination Policies - This are important policies to note. While other policies in your employee handbook may be worded more casually, it is crucial to put your Equal Opportunity and Non-Discrimination Policies in high legalese. Here’s an example:

SkyePi Inc. does not discriminate against employees on the basis of race, color, national or ethnic origin, ancestry, age, religion or religious creed, disability or handicap, sex or gender (including pregnancy, sexual harassment and other sexual misconduct including acts of sexual violence such as rape, sexual assault, sexual exploitation and coercion), gender identity and/or expression (including a transgender identity), sexual orientation, military or veteran status  genetic information,  or any other characteristic protected under federal, state or local law.  Retaliation is also prohibited.  SkyePi Inc. will comply with state and federal laws such as M.G.L. c. 151B, Title IX, Title VI and Title VII of the Civil Rights Act, the Americans with Disabilities Act, Section 504 of the Rehabilitation Act of 1973, the Age Discrimination in Employment Act, and other similar laws that prohibit discrimination.

·         Worker’s Compensation Policy – This is the policy that insures workers against work-related accidents, lost work time, or medical bills.

All employees are covered by workers’ compensation insurance, which compensates an employee for lost time, medical expenses, and loss of life or dismemberment from an injury arising out of or in the course of work. Employees must report any accident or injury immediately to his/her supervisor and the Human Resources Department so that the necessary paperwork may be completed.

·         Family Medical Leave Policy – This is the policy by which an employee may take unpaid medical leave while retaining job protection and company health insurance.

·         Time Off – In this section, explain your company policy on taking time off. Note – this is different from paid or unpaid vacations.

·         Employee Conduct – Here, lay down the law as regards dress code, proper vs. improper treatment of clients and coworkers, punctuality, demeanor and your policy on sexual harassment.

·         Payment – Provide an outline of the payroll schedule and, if it seems pertinent, pay-scales for every major position.

·         Benefits – Describe the employee benefits package, including sick leave, vacation, retirement and social security.


This section states the purposes of the employee handbook and gives you, the employer, the right to change policies at will.

Proof of Receipt

It’s important to include a detachable page or something similar stating that the employee has received, read and agreed to the policies included in the handbook. This page may then be detached and given to HR.

Download a PDF or Word Template

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