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Do employee handbooks help businesses avoid litigation?

On Behalf of | Sep 8, 2022 | Business Law

When you own and operate a business in Kentucky, you run the risk of facing various types of lawsuits. Many business owners wind up facing lawsuits relating to discrimination, wage and hour violations, or contract breaches, among other common causes, and all such lawsuits have the potential to take valuable time and money away from your company’s operations.

However, Inc. reports that you may be able to lessen your company’s chances of finding itself embroiled in a lawsuit by creating and implementing the use of an employee handbook.

How an employee handbook protects your business

There are several important ways in which an employee handbook helps protect your business against litigation. For starters, it helps ensure that your workers have a clear understanding of what you expect of them. An employee handbook typically spells out your business’s policies in a clear, concise manner that leaves little room for interpretation. Having a handbook in place may also give you a legal leg to stand on if the employee who files a lawsuit against you signed a handbook indicating he or she read through and agreed to its terms.

What to include in your employee handbook

In your handbook, use clear, direct language to spell out your company policies, benefits and related issues, such as how you determine when to give employees raises. Many business owners also include their company’s mission statements, contractual disclaimers, compensation plans and termination standards, among other relevant areas.

As important as having an employee handbook is having a way to prove your employee’s received and read them. So, make sure there is a way for your workers to sign their names in the handbook so that they may not claim they never saw it later.