March 15, 2022

Ag & the Law: Does Your Company Need an Employer Handbook? Spoiler Alert: Yes, it Does!

By Teresa McQueen, Western Growers Corporate Counsel

Agricultural employers, in addition to all the other tools needed to assist in running their businesses, need a written employee handbook to protect their company from legal risks, set forth policies and procedures to guide employees and supervisors, and provide information on company benefits.

Why Does an Employer Need an Employee Handbook?

While state and federal law do not require businesses to create or distribute employee handbooks, the law does require every business to memorialize certain workplace policies in writing. For example, the California Fair Employment and Housing Act (FEHA) requires that employers with at least five employees distribute written harassment, discrimination and retaliation prevention policies. As a risk management tool, the employee handbook can be an effective first line of defense against claims of discrimination and other wrongful conduct. Laws continue to change, placing more and more responsibility on employers. Having an employee handbook and reviewing it for updated legal compliance is critical for employers.

Employee handbooks typically provide an overview of personnel procedures, work rules and fringe benefits. Handbooks help with orienting and training new employees; create a legal document which can be used to defend the employer; increase consistent treatment of employees and help avoid favoritism or discrimination; as well as guide the actions of management and supervisory personnel. With more focus on promoting equal opportunity, diversity and inclusion, it is more important than ever that employers understand and follow state, federal and local equal employment laws.

As a resource tool the employee handbook serves as a one-stop shop for information on all the business’ most important policies and procedures. A place where employees can quickly find information about employer expectations, benefits, employee rights and learn about the consequences for failing to adhere to company policies/procedures.

When Should a Business Create an Employee Handbook?

The ideal time to create and implement an employee handbook is pre-employment or at the inception of the organization. But it’s never too late to introduce an employee handbook into an existing organizational structure. An employee handbook is integral to human resources operations—an often-overlooked aspect of business operations—and creation and maintenance of the company’s unique culture.

When rolling out a new employee handbook—or updating an existing handbook—employers should keep the following tips in mind:

  • Determine the most effective method of distribution. For example, when introducing a new employee handbook, a company-wide meeting might be most effective. For introducing an updated handbook or updated policy perhaps email communications might work best.
  • If the organization has been operating without a handbook, explaining which policies may differ from current practices will be important.
  • Whether introducing a new or updated handbook, employers will want to be sure to require all employees to sign an acknowledgment attesting to receipt of the new or updated handbook.
  • Never think of a handbook as something stagnant. Because employment laws are continually changing, the company’s employee handbook should be reviewed on an annual basis and updated as necessary. Annual reviews should include, among other areas, an overall review of the following areas:
  • Cultural changes within the company
  • Technical changes or updated protocols
  • Changes in the law
  • Changes necessary due to company growth

Implementing and Enforcing Handbook Policies/Procedures

Generally, an employer may implement and enforce its lawful policies/procedures so long as application or enforcement does not unlawfully discriminate or negatively impact any one employee or group of employees based on a protected classification (e.g., race, religion, sex, national origin).

Employers with unionized employees must also be careful that the policies reflected in their handbooks are consistent with any collective bargaining agreement(s) in effect. Employers should also be aware of the potential impact of the National Labor Relation Act and the Agricultural Labor Relations Act on various employee policies.

Busting Common Employee Handbook Myths

As discussed above, an employee handbook can be a resourceful tool and an effective first line of defense against claims of discrimination and other wrongful conduct. Not yet convinced? Let’s bust a few common myths.

Myth #1: When it comes to employee handbooks, one size fits all.

Your company is unique, and your handbook should reflect that uniqueness. Using an “off the shelf” handbook template may seem like the ideal time saving tool, but there are several ways it can also create liability. Standardized templates and policies lack the necessary customization needed to ensure compliance with not only federal, but state and local laws; rarely reflect actual company practices; and tend to be poorly written. All of this can lead to increased liability.

Myth #2: Having an employee handbook gives my employees a roadmap on how to sue me.

Some employers feel that an informed employee is something to be feared; that an employee handbook is nothing more than a roadmap to litigation. Let’s flip that perspective for a moment. Employees who understand the law—what it requires of employers and employees—are in a better position to understand the employer’s actions and are less likely to resent or mistrust an employer who follows the law.

Opening the lines of communication with employees (e.g., engaging with them during training sessions or when rolling out an updated handbook) is a great way to build trust and encourage employees to communicate with the employer when there is a problem. Building trust with employees is also a great risk mitigation tool. Having a strong rapport with employees increases the likelihood that when confrontation occurs, they will turn to the employer for answers or solutions as opposed to someone outside the organization.

Myth #3: My operations are too small to warrant an employee handbook.

Small employers may not be subject to certain state or federal laws, but they can still be liable for “bet the farm” violations relating to wage and hour laws and harassment based on protected classifications.* Having an employee handbook is also an easy way to create a more professional image and make sure even a small number of employees understand what the company expects from them and how they can help guide company culture.

The bottom line is a customized and legally compliant employee handbook, consistently enforced and updated, can be an invaluable resource for any business.

Western Growers now offers a hands-on workshop to build out a completed and customized legally compliant employee handbook ready to distribute to your organization’s employees. For more information about our workshops, please contact Teresa McQueen at [email protected].

*All employers are subject to state and federal wage and hours laws. In California, all employment provisions of the Fair Employment and Housing Act’s (FEHA) anti-discrimination provisions apply to all employers with five or more full-time or part-time employees. In addition, FEHA’s anti-harassment provisions apply to employers with just one employee.