Employment Manuals: An Ounce of Prevention

In few areas are employers more heavily regulated than in their employment relationships. At the federal level, such regulation includes: the Fair Labor Standards Act, the National Labor Relations Act, the Immigration Reform and Control Act of 1986, the Rehabilitation Act of 1973, the Americans with Disabilities Act, the Family and Medical Leave Act, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Age Discrimination in Employment Act, the Employee Retirement Income Security Act, and executive orders applicable to federal government contractors. At the local level, state common law and numerous statutes, regulations and ordinances affect virtually every aspect of the employment relationship, and in some cases, impose pre- and post employment obligations.

Some employers attempt to navigate this regulatory minefield without clearly defined written policies and procedures that take into account the federal, state and local laws applicable to their operations. The larger the employer, or the more jurisdictions encompassed by its operations, the more hazardous this becomes.

Many employers develop written policies and procedures but fail to update them to ensure their continuing validity. Such neglect is hazardous because employment law is one of the most rapidly changing areas of law. Since 1986, there have been numerous legislative enactments and court decisions at the federal, state and municipal levels that directly affect the employer/employee relationship.

Because of the number of laws and regulations to which employers are subject and the diversity of these laws among states and municipalities, every employer should have a company policy and procedure manual(s) that sets out its employment policies with specified procedures to implement those policies and forms to be used for specific personnel transactions. The purpose of a policy and procedure manual is to inform managers and supervisors of what the policies and procedures are, to guide them in their day-to-day application of the policies and to achieve uniformity.

Virtually every employer should also have an employee handbook(s) for its nonunion employees that introduces them to the company and familiarizes them with the guidelines and benefits that affect their employment. Its purpose is to ensure uniform communication of selected information in a positive and unambiguous manner. The handbook must be carefully drafted to avoid ambiguity and the creation of unintended contractual obligations.

The same handbook should not be used for both nonunion and union employees. Before issuing a handbook to its union employees, the employer should consult labor counsel to avoid contract violations or the commission of unfair labor practices.

Many states require employers to communicate certain policies to employees in writing. For example, New York requires employers to publish in writing their policies concerning working hours, sick leave, vacation, personal leaves and holiday pay and to publish written policies concerning smoking in the work place. Even when not required, it may be legally advantageous to have a written policy. For example, federal government contractors or subcontractors subject to Executive Order 11246 must comply with sex discrimination regulations promulgated by the Office of Federal Contract Compliance Programs (OFCCP). If such contractor does not have its own written policy regarding maternity leave, it must comply with regulations promulgated by OFCCP which go beyond the requirements of Title VII of the Civil Rights Act of 1964.

Unwritten and nonstandardized policies and procedures can lead to inconsistent and disparate treatment of employees, violations of law, litigation, poor morale and union organization.

Employers should develop and maintain comprehensive, up-to-date policy and procedure manuals and employee handbooks. They should be regularly reviewed and updated to ensure their compliance with law and their effectiveness from an employee relations standpoint. While this will entail an administrative cost, substantial savings will be realized if just one civil rights complaint or lawsuit is avoided.

The Labor and Employment Group at Danna McKitrick, P.C. is experienced in assisting employers in developing and maintaining manuals and handbooks designed to comply with federal and state laws and regulations and municipal ordinances, to avoid litigation; and, for nonunion employers, to reduce the likelihood of union organization.