If you have employees, especially in New York, you need a handbook to create and enforce policies that will save your company money in the long run.
By Larry Kagan, Founder & CEO, Baron Payroll
You catch an employee loading up his car with a company computer, stealing it right in front of your eyes. You take your equipment back and fire him immediately, catching him just in time to protect your property.
It should be cut and dry: He did something clearly wrong, you witnessed it.
But he files for unemployment – and gets paid out. He wasn't arrested or prosecuted for any crime, and in the United States, you're innocent until proven guilty.
You could have prevented the unemployment payout with one important document that will save your company from all kinds of risks: an employee handbook.
Creating an employee handbook with clear policies of acceptable behavior in your workplace is one of the most significant ways to protect your company. It is a strong line of defense against employee lawsuits or claims and can help you save on your insurance policies.
Especially in New York, if you have employees, you should have an employee handbook. Period.
Yet many small businesses don't bother, leaving them open to legal ramifications they can't afford. We get it: It's not top of mind, given all the work that goes into running a company.
Thankfully, Baron offers a solution that's painless to your company, affordable, and in-depth.
Why you need a handbook
An employee handbook includes applicable federal, New York state and local laws. It also sets clear expectations and details the company's internal policies outside of laws, on topics like compensation, time off, drug and alcohol usage, company vehicles, health and safety.
Across dozens of pages, it covers what is out of bounds for the company, making clear what kinds of actions could result in termination.
The handbook certainly helps employees better understand their role as a worker. But the benefits extend far beyond that.
Insurance companies often ask to see employee handbooks to see what sorts of policies govern your company activities. As a result, a company without a handbook is seen as riskier than companies that have one.
Instituting a handbook could show your insurance company you aren't a risky venture.
Policies in your handbook can prevent successful unemployment or worker's compensation claims, too.
For instance, we suggest including a policy in your handbook that calls for a drug test whenever an employee submits a worker's compensation claim. Testing positive for drugs can prevent the claim from being approved, saving money.
On the unemployment front, if a worker clearly violates company policies and loses their job, this can prevent them from receiving a check.
Perhaps the biggest avoided cost comes from fending off potential lawsuits. An employee who gets fired could file a wrongful termination suit. If you don't have policies to point to that show they violated your company's rules, they could succeed. But if you have an ironclad handbook, you're in a much safer position.
The handbook contains the laws and rules for the company. You can't fire anybody for breaking the rules if they don't know what the rules are.
It's not just creating a handbook
The handbook alone won't save you from problems. And you can't just create one then let it sit for five years.
A company must distribute the handbook to employees, who have to sign an acknowledgment of receipt memorializing that they received the handbook. This prevents an employee from later claiming they had no idea there was a handbook with rules in it.
We make this process straightforward. Your HR software can send an alert to employees, reminding them to read the handbook and sign the acknowledgment digitally. A copy is saved electronically in their HR file in the cloud, creating an easily retrievable record should the need arise to prove an employee acknowledged your handbook's existence.
An employee handbook should be updated annually, especially in a state like New York that's continually adding and changing employment laws, sometimes as many as 20 new regulations in just one year. You don't want your company guidelines to be out of date; that could cause problems with the very things the handbook is supposed to protect against.
Each time the handbook is updated, employees again need to sign and acknowledge they received a copy of it.
Additionally, if your company has a handbook, its policies need to be followed. You can't play favorites or change policies on the fly because your practices mean more than the written word.
How to create a handbook
The question isn't, "Does my company need an employee handbook?" You do. Instead, let's focus on how we can get you an in-depth one affordably.
You may be tempted to search the internet for a template that allows you to plug in a few items and cross the handbook off your to-do list.
That's garbage – it's worse to have a bad handbook than no handbook at all. Templates don't provide knowledge and expertise. You won't get personalized, state and local information about New York laws and regulations that impact your business. You could unwittingly include erroneous information that you would be beholden to.
You need a professional. And we know some.
The first words that come to mind when thinking about human resources probably aren't "easy" or "simple." But the service we provide through our human resources partner is just that.
Most small businesses can't afford an in-house human resources department. For $1,000 a year, you get unlimited access to a team of human resources professionals who know the NY state and local laws and will create a strong handbook for your company.
And that's just the beginning. You can also get human resources advice, chat with an HR professional, create detailed job descriptions and get your compliance questions answered about COVID-19, FFCRA, FLSA, WTPA, OSHA, ERISA, INA, FECA, FMLA, WARN, and EEOC -- just to name a few employment laws.
The handbook alone is worth the cost. We know you're focused on getting a return on your investment, and having an updated employee handbook may be the best investment you can make for your business.
You can save money on unemployment claims by preventing employees who broke company policies from receiving it. You can save on your time-off policies by clearly defining what happens upon termination – payout or no payout. You could save on your insurance rates. In the event of a lawsuit from a disgruntled employee, your handbook will protect against financial damage.
Think of our HR service and the handbook we can create, like a gym membership: It keeps your company healthy.
Convinced you need an updated employee handbook and ready to get started?
