Steps for Creating an Employee Handbook

Creating an employee handbook is a big job but doesn't have to tie you to your desk.
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Perhaps you are growing your small business and need an employee handbook for the first time. Or maybe you drew the short straw and have been nominated to redo your company’s outdated manual. Either way, the work must be as inclusive as possible and outline the company’s policies on attendance, benefits, computer usage, safety procedures, labor laws, workplace violence and sexual harassment, among other things. Potential legal ramifications and the sheer scope of the project can make the task seem overwhelming, but there are several things you can do to make the job easier.

Review Current Policies

Review all of your current policies and procedures before drafting an employee handbook. Modify any existing policies that are not working well and add new ones if necessary to ensure that all of the relevant information is included in the new handbook. The process of total policy review can be time consuming and a bit tedious, but a thorough policy review before creating the handbook delays the need to update the document later. It can also help protect you legally, since creating a formal document outlining policies and procedures can create obligations for both you and your employees.

Choose a Distribution Method

As you draft your new employee handbook, think about how best to distribute it to employees. Printed handbooks work well but can be difficult to create in-house depending on the size of the project. Electronic versions of the handbook are easily updated and distributed, but it can be more difficult to ensure that all employees received an electronic document. Some states mandate that paper copies of the handbook must be made available to any employee who requests it. The goal is to make the information as easily accessible to employees as possible, both to provide her with a reference and to prevent her from claiming she was unaware of a clearly stated policy.

Check with Legal

The employee handbook can create a legally binding contract between company and employee. This may be good for the company if, for example, the handbook clearly states the firm was justified in firing a chronically absent employee. But handbook language can also work against the company. A stated list of disciplinary procedures to be followed before terminating an employee could be used against a company that fires an employee without first exhausting all of the disciplinary actions outlined in the handbook. A legal review ensures that the document complies with all federal and state laws and that it does not create unintended legal issues.


One of the most common mistakes employers make is forgetting about the handbook once the initial project is complete. While you won’t need to modify the employee handbook frequently, changes in employment law and internal policy changes can both necessitate updating the handbook. When the original handbook is complete, appoint someone in the office to be responsible for updating the handbook when necessary. This person should also be responsible for having the changes reviewed by legal counsel and distributing the updated handbook to employees.

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