Employee Handbooks: Every Word Counts Alan Weitzman

1. Employee Handbooks:
Every Word Counts
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Allan H. Weitzman | August 29, 2011

2. SEVEN PRINCIPLES TO FOLLOW WHEN CREATING
AN EMPLOYMENT HANDBOOK
I. Make Sure Your Handbook is NOT an Employment Contract
II. Plainly State Employer Rules, Regulations and Procedures
III. Describe Your Policies Designed to Assist Employees
IV. Communicate Your Commitment to Equal Opportunity
V. Set Guidelines for the Termination of Employment
VI. Develop Cutting Edge Policies
VII. Incorporate State and Local Legal Requirements into Your
Handbook

3. I.
Make Sure
Your Handbook
is NOT an
Employment
Contract
2

4. I. Make Sure Your Handbook is NOT an Employment Contract
Handbooks Can Be Interpreted as Creating Express
or Implied Contracts
• State law controls
• Old handbooks may create
rights that cannot be
freely changed
3

5. I. Make Sure Your Handbook is NOT an Employment Contract
Handbooks May Create Implied Contracts of
Employment Where:
• Handbook sets forth progressive discipline plan or corrective
action procedures
• Handbook distinguishes between “probationary” and “permanent”
employees and provides for discharge of “permanent” employees
only after specific preconditions are met
– e.g., written notice and a 30-day opportunity for improvement required
before termination because of unsatisfactory work performance
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6. I. Make Sure Your Handbook is NOT an Employment Contract
See:
• Falls v. Lawnwood Medical Center, 427 So. 2d 361
(Fla. 3d DCA 1983):
– The court reversed the grant of summary judgment in favor of the employer hospital
and remanded the case back to the trial court to consider whether certain policy
manuals were part of the employee’s employment contract. Thus, Falls leaves open
the possibility that, under certain circumstances, a policy manual might be viewed as
constituting an enforceable contract in Florida.
• Walton v. Health Care Dist., 862 So. 2d 852, 855
(Fla. 4th DCA 2003) :
– Stating that “while Florida’s courts have expressed a decided reluctance to find that
provisions in an employee handbook or policies and procedures manual rise to the
level of enforceable contract rights, the courts have acknowledged it is possible for
such handbooks or manuals to create enforceable rights if there is language in the
employee manual expressly providing that the manual constitutes a separate
employment agreement or the parties have reached a mutual agreement to this
effect.”

7. I. Make Sure Your Handbook is NOT an Employment Contract
See also:
• Muller v. Stromberg Carlson Corp., 427 So. 2d 266, 268
(Fla. 2d DCA 1983):
– The court ruled in favor of the employer in a case brought by a
discharged employee, stating: “[The Employee] feels that we should
find an enforceable inference of . . . contract terms from the company
policy. We cannot agree. We see no justification to depart from long
established principles that an employment contract requires
definiteness and certainty in its terms. . . . Mere expectations are
insufficient to create a binding term of employment.”

8. I. Make Sure Your Handbook is NOT an Employment Contract
But see:
• Quaker Oats Co. v. Jewell, 818 So. 2d 574 (Fla. 5th DCA 2002):
– The appellate court overturned the decision of a lower court that held
Quaker Oats responsible for creating a contractual obligation as a
result of its employment handbook. Nine employees sued Quaker
Oats alleging breach of contract because Quaker Oats failed to pay
overtime in accordance with the policies set forth in its handbook. The
court held that based upon well established Florida law, policy
statements in an employee handbook do not constitute the terms of a
contract of employment.

9. I. Make Sure Your Handbook is NOT an Employment Contract
Disclaimers Assist in Preventing the Creation of
Implied Contracts
• Prominently display the disclaimer in the handbook
• Advise employees that the policies and procedures are not
intended to create a contract
• Obtain a signed receipt upon distribution of the handbook
• Reserve the right to modify or discontinue the policies and benefits
set forth in the handbook at any time, without notice
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10. I. Make Sure Your Handbook is NOT an Employment Contract
Examples of the role of a disclaimer in a handbook:
• Turner v. Fed. Express Corp., 539 F. Supp. 2d 404
(D.D.C. 2008):
– Handbook does not create an implied contract where the
disclaimer expressly states that it is not a contract of employment
and should not be read or implied to provide one, and where that
language is repeated on the acknowledgement of receipt signed
by the employee.
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11. I. Make Sure Your Handbook is NOT an Employment Contract
Examples… (cont’d)
• Aponte v. Alinabal, Inc., 2008 Conn. Super. LEXIS 1505
(Conn. Super. Ct. May 29, 2008):
– In determining the validity of disclaimers, Connecticut courts have looked at the
specificity of the disclaimer language, its location in the handbook, whether the
disclaimer was signed by the employee, and the size of the print. Where, the
disclaimer is in the same size print as all other text; contains an underlined
statement that the Handbook “does not constitute an employment contract, neither
expressed nor implied”; is signed by the plaintiff; and could not be clearer, the
progressive disciplinary policy discussed therein did not result in an implied contract.
• But see Burns v. Universal Health Servs., Inc., 361 S.C. 221
(S.C. Ct. App. 2004):
– Where promissory language and disclaimers make the handbook ambiguous, a jury
should interpret whether the handbook creates or alters an existing contractual
relationship.

12. I. Make Sure Your Handbook is NOT an Employment Contract
Sample Disclaimer:
• There are several things that are important to keep in mind about this handbook.
First, it contains only general information and guidelines. It is not intended to be
comprehensive or to address all the possible applications of, or exceptions to, the
general policies and procedures described. For that reason, if you have any
questions concerning eligibility for a particular benefit or the applicability of a policy
or practice to you, you should address your specific questions to the Human
Resources Department.
• Neither this handbook nor any other Company document confers any
contractual right, either express or implied, to remain in the Company's
employ. Nor does it guarantee any fixed terms and conditions of your
employment. Your employment is not for any specific time and may be
terminated at will, with or without cause and without prior notice by the
Company, or you may resign for any reason at any time.
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13. I. Make Sure Your Handbook is NOT an Employment Contract
Sample Disclaimer: (cont’d)
• No supervisor or other representative of the Company (except the
President, in writing) has the authority to enter into any agreement
for employment for any specified period of time, or to make any
agreement contrary to the above.
• Second, the procedures, practices, policies and benefits described
here may be modified or discontinued from time to time. We will
try to inform you of any changes as they occur.
• Finally, some of the subjects described here are covered in detail
in official policy documents. You should refer to those documents
for specific information since this handbook only briefly
summarizes those benefits. Please note that the terms of the
written insurance policies are controlling.

14. I. Make Sure Your Handbook is NOT an Employment Contract
Sample Receipt for an Employee Handbook:
I acknowledge that I have received a copy of XYZ Company's Employee
Handbook. I agree to read it thoroughly, including the statements in the foreword
describing the purpose and effect of the Handbook. I agree that if there is any
policy or provision in the Handbook that I do not understand, I will seek
clarification from the Human Resources Department. I understand that XYZ
Company is an "at will" employer and as such, employment with XYZ is not for a
fixed term or definite period and may be terminated at the will of either party, with or
without cause, and without prior notice. No supervisor or other representative of
the company (except the President, in writing) has the authority to enter into
any agreement for employment for any specified period of time, or to make
any agreement contrary to the above. In addition, I understand that this
Handbook states XYZ's policies and practices in effect on the date of publication. I
understand that nothing contained in the Handbook may be construed as creating a
promise of future benefits or a binding contract with XYZ for benefits or for any other
purpose. I also understand that these policies and procedures are continually
evaluated and may be amended, modified or terminated at any time.

15. I. Make Sure Your Handbook is NOT an Employment Contract
Disclaimers Don’t Solve
Every Problem:
Even with a disclaimer,
it is important for an employer to
follow its handbook policies.
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16. II.
Plainly State
Employer Rules,
Regulations and
Procedures
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17. II. Plainly State Employer Rules, Regulations And Procedures
• Access to Personnel Records
• Anti-Nepotism or No-Spouse Rule
• Searches on Employer Property
• In-House Investigations
• No Solicitation, Bulletin Boards and E-Mail Rules
• Travel Policies
• Attendance, Punctuality and Dependability
• Performance Evaluations
• Payment of Wages
• Employer Property

18. II. Plainly State Employer Rules, Regulations And Procedures
• Deductions from pay for unpaid disciplinary
suspension of one or more full days for
infractions of workplace conduct rules
applicable to all employees – exempt and
non-exempt (pursuant to FLSA DOL
regulations)
• Policy that prohibits improper pay
deductions and creates avenue for
employee complaints concerning
deductions
17

19. II. Plainly State Employer Rules, Regulations And Procedures
Beware of NLRA Dangers Lurking
in Personnel Policies!
• Unfair labor practices have been predicated on
common policies found in many employee
handbooks:
– Employee Rules of Conduct
– Confidentiality Rules
– Chain-of-Command Rules
– Fraternization Rules
– Solicitation and Distribution Policies
– Bulletin Boards and E-Mail Systems
– Employee Dress Codes

20. II. Plainly State Employer Rules, Regulations And Procedures
• An employer rule will be found unlawful when
it “reasonably tends to chill employees in
the exercise of their Section 7 rights” to
form, join or assist unions or engage in other
concerted activity for mutual aid or
protection.
– Lutheran Heritage Village–Livonia, 343 NLRB
646 (2004), citing Lafayette Park Hotel, 326
NLRB 824, 825 (1998).
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21. II. Plainly State Employer Rules, Regulations And Procedures
To Avoid Running Afoul of the NLRA . . .
• Policies MAY prohibit: • Policies may NOT prohibit:
– Abusive and profane language – Selling or soliciting anything
– Harassment anywhere on company property
at any time without permission
– Verbal, mental and physical abuse
– Loitering on company property
– Deliberately or maliciously false without permission
statements regarding other
employees, the company or its – Strikes, work stoppages or other
products interference with production
– Being uncooperative with – Merely false or inaccurate
supervisors, employees or guests statements
– Engaging in conduct that does not – Employee discussion of
support employer’s goals and “confidential” terms and
objectives conditions of employment

22. III.
Describe
Your Policies
Designed to
Assist Employees
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23. III. Describe Your Policies Designed to Assist Employees
• Federal Family and Medical Leave Act • Military Leaves of Absence
• State Family and Medical Leaves of • Jury Duty Leave
Absence
• Bereavement Leave
• Pregnancy, Disability and
• Employee Assistance Programs
Child Care Leaves of Absence
• Other Time Off:
• Short Term Disability Leaves of
Absence and Salary Continuance – Vacations
Policies – Holidays
– Religious Observance
– Personal Days
– Flex Time
– Blood, Bone Marrow, and Organ
Donation Leave
– Domestic Abuse Leave

24. III. Describe Your Policies Designed to Assist Employees
Recent Developments:
• “Reasonable Break Time For Nursing Mothers”
– Section 4207 of the Patient Protection and Affordable Care Act
(P.L. 111-148) signed into law by President Obama on March 23,
2010 requires that:
• Break time be provided for one year after a child's birth each time an
employee needs to express milk.
• Provision of a private, shielded place other than a restroom in which the
nursing mother may express breast milk.
– Section 4207 does not specify what constitutes “reasonable” break
time, nor does it indicate any limits on the number of breaks a nursing
worker may take.
– The measure does not preempt state laws with more generous
provisions for nursing mothers.

25. III. Describe Your Policies Designed to Assist Employees
Recent Developments: (cont’d)
• “Reasonable Break Time For Nursing Mothers” (cont’d)
– E.g., Ca. Civ. Code §43.3 (2007), Cal. Lab. Code §1030 (2007)
• Employer must allow the mother to breastfeed her child in any
location mother and child are otherwise permitted to be (does not
apply to expressing milk).
• The penalty for violating this statute is $100.00 per violation.
• Employer must provide storage (e.g., a refrigerator) for expressed
milk.

26. III. Describe Your Policies Designed to Assist Employees
Recent Developments: (cont’d)
• The 2010 National Defense Authorization Act
– Service-Member Family Leave
• Provides up to 26 weeks/year of protected unpaid leave to any
eligible employee who is the spouse, child, parent, or next-of-kin
of a covered service-member to care for his or her relative (the
service-member) injured during active duty
– “Qualifying Exigency” Leave
• Permits an otherwise eligible employee to take up to
12 weeks/year of leave as a result of any “qualifying exigency”
(e.g., employee’s spouse, child, or parent is on or has been called
to covered active duty in the armed forces)

27. III. Describe Your Policies Designed to Assist Employees
Recent Developments: (cont’d)
• Employees ineligible for FMLA leave may have cause of action based on
handbook statements
– Peters v. Gilead Sci., Inc., 533 F.3d 594 (7th Cir. 2008):
• An employee handbook promised 12 weeks of leave and recited the
12-month, 1,250-hour prerequisites for FMLA eligibility, but failed to
mention the 50/75 exception. In addition, the employer informed the
employee that he was eligible for leave. Prior to reinstatement, the
employee was terminated based on his status as a “key employee” under
the FMLA.
• The employee, though statutorily ineligible for FMLA leave under the 50/75
rule, could assert a valid promissory estoppel cause of action under
Indiana state law. The court held that the leave provisions in the employee
handbook may be enforceable as a contract under Indiana law, and, at the
least, are promises giving rise to recovery under promissory estoppel.

28. III. Describe Your Policies Designed to Assist Employees
Recent Developments: (cont’d)
• Employees ineligible for FMLA leave may
have cause of action based on handbook
statements (cont’d)
– Jadwin, D.O. v. County of Kern,
610 F. Supp. 2d 1129 (E.D. Cal. 2009):
The court held that when an employer grants
FMLA leave, estoppel can bar an employer
from later challenging the timeliness of the
notice, and, furthermore, that estoppel can
also bar an employer from later challenging
eligibility for that leave.)

29. IV.
Communicate
Your Commitment
to Equal Opportunity
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30. IV. Communicate Your Commitment to Equal Opportunity
• Equal Employment Opportunity Policies
• Anti-Discrimination, Harassment and Retaliation Policies and
Complaint Procedures
– Faragher and Ellerth
– Gorzynski
– Suders
– Kolstad
– Burlington Northern

31. IV. Communicate Your Commitment to Equal Opportunity
Equal Employment Opportunity Policy Statement:
• Equal Employment Opportunity has been, and will continue to be, a
fundamental principle at XYZ, where employment is based upon
personal capabilities and qualifications without discrimination because of
race, color, religion, sex, pregnancy, age, national origin, disability,
genetic information, or any other protected characteristic as established
by law.
• This policy of Equal Employment Opportunity applies to all policies and
procedures relating to recruitment and hiring, compensation, benefits,
termination and all other terms and conditions of employment.
• Employees’ questions or concerns should be referred to the Human
Resources Department, which has overall responsibility for this policy
and maintains reporting and monitoring procedures.
• Appropriate disciplinary action may be taken against any employee
willfully violating this policy.

32. IV. Communicate Your Commitment to Equal Opportunity
Elements of an “C’mon – let’s discuss your
promotion over dinner…”
Anti-Harassment Policy:
• Include Sex and All Other Protected
Characteristics (check local and state laws)
• Specifically State EEOC’s Definitions
• Define Other Forms of Harassment
• Give Examples of Harassing Behaviors
• Define Supervisory Responsibility

33. IV. Communicate Your Commitment to Equal Opportunity
Elements of an
Anti-Harassment Policy: (cont’d)
• Outline Penalties for Engaging in Harassment
• Set Forth Clear, Internal Complaint Procedure, with Multiple Intake
Points
– [Not Just Supervisor!]
• State Employer’s Investigation Obligations
• Limited Confidentiality Assurance
• Include Anti-Retaliation Provision
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34. V.
Set Guidelines
for the
Termination of
Employment
33

35. V. Set Guidelines For The Termination Of Employment
• Required Notifications
• Severance Pay Policies
• Post Employment References
• Grievance or Complaint Procedures
• Arbitration and/or Jury Trial Waiver
Agreements

36. V. Set Guidelines For The Termination Of Employment
Arbitration Agreements
• Arbitration agreements provide that any claim or controversy
arising out of the employment relationship will be submitted to an
impartial private arbitrator for final and binding resolution.
• Arbitration agreements are valid and enforceable in the
employment context.

37. V. Set Guidelines For The Termination Of Employment
Advantages To Mandatory Arbitration
• Reduces litigation expenses
• Minimizes litigation risks
• Promotes confidentiality
• Improves employee relations
• Can prevent class actions
BEWARE of special requirements (e.g., that employer pay all costs
and fees, including arbitrator’s fees).

38. V. Set Guidelines For The Termination Of Employment
Jury Trial Waivers:
• What they mean
• Jury Trial Waivers Are Generally Enforceable
• The Advantages of Jury Trial Waivers
– Removes risk that prejudiced and impassioned
juries will decide on a large verdict for the
employee
– Avoids additional expense of arbitrator’s fees
– Judges are more inclined than arbitrators to
impose sanctions, if necessary
– Judges are more likely to grant motions to
dismiss on the pleadings and summary
judgment
– Judge’s decision is subject to full appellate
review

39. VI.
Develop
Cutting Edge
Policies
38

40. VI. Develop Cutting Edge Policies
Technology Policies
• Social Networking Sites
• Blogging
• Company Equipment
– Use for Business Purpose Only
– Be Courteous
• No Expectation of Privacy/Employer
Property
• Waiver of Privileges

41. VI. Develop Cutting Edge Policies
Technology Policies (cont’d)
• Anti-Harassment Policies are Applicable
• E-mail, Voicemail, Blackberries and PDAs, Internet, Instant
Messaging, Chat Rooms, Public Internet Posting, etc.
• Telephone Call Monitoring
• Tape Recording
• Telecommuting

42. VI. Develop Cutting Edge Policies
Cell Phones:
• Potential liability to the employer may
attach based on employees’ use of cell
phones while driving in the course of
their employment
– An employer is vicariously liable for
an employee’s negligence if the
employee’s negligent act(s) occurred
within the scope of his or her employment
and was in furtherance of the employer’s
interest

43. VI. Develop Cutting Edge Policies
Cell Phone Tips for Employers to Avoid Liability:
• Make sure that employees know the features available on their cell
phone and how to use them
• Require the use of hands-free devices, memory, one-button and
voice-activated dialing
• Check that the cell phone is within easy reach of the driver
• Advise employees to inform anyone with whom they are speaking
that they are driving while on the phone
• Advise employees to avoid using cell phones during hazardous
weather and traffic conditions

44. VI. Develop Cutting Edge Policies
Cell Phone Tips for Employers to Avoid Liability: (cont’d)
• Ensure that employees do not look up phone numbers or take
notes while they are driving
• Advise employees to make calls while they are not moving or
prior to pulling into traffic
• Advise employees to avoid emotional or stressful discussions
while driving
• NO TEXTING!!!

45. VI. Develop Cutting Edge Policies
Special Issue: Camera Phones
• Total or partial ban
• If partial, ban camera phones in
restrooms and locker rooms

46. VI. Develop Cutting Edge Policies
Dress and Grooming Codes:
• Employers are free to define business attire
differently for men and women
• Courts have upheld
– Prohibitions on female employees wearing pants
• But see California Government Code Section
12947.5: making it unlawful for an employer to
refuse to permit an employee to wear pants on
account of the sex of the employee (but not
prohibiting an employer from requiring an
Employee to wear a uniform).
– Prohibitions on male employees wearing an earring
– Policies on hair length for men

47. VI. Develop Cutting Edge Policies
Special Issue: Body Piercings and Tattoos
• Some courts have upheld company
policies that prohibit wearing facial
piercings or body art in the workplace.

48. VI. Develop Cutting Edge Policies
Cross-Dressing in the Workplace
• Some courts have held that a male
employee dismissed for wearing
female attire cannot successfully
bring a claim of sex discrimination.
• However, cross-dressing may be
protected under certain state and
local anti-discrimination laws.

49. VI. Develop Cutting Edge Policies
Drug and Alcohol Testing in the Workplace:
• Benefits of drug-free workplace policies
– Decreases in absenteeism, turnover, downtime, accidents and thefts
– Increased productivity and overall employee morale
• A drug and alcohol testing policy
should be part of the company’s
drug-free workplace policy
– Include a detailed description of
the drug testing procedures
48

50. VI. Develop Cutting Edge Policies
Drug and Alcohol Testing in the Workplace: (cont’d)
• Generally, employers may test applicants and employees in the
following circumstances (subject to state and local laws)
– During a yearly physical
– Prior to transfers or promotions
– Prior to being placed in positions involving security, safety or money
– After an accident
– Where used drugs in past
– After treatment
– Based on reasonable suspicion
– On a random basis
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51. VI. Develop Cutting Edge Policies
Guns in the Workplace:
• Requirements of the Occupational Safety and Health Act
(“OSHA”):
– Employers must provide a workplace that is “free from recognized
hazards that are causing or likely to cause death or serious physical
harm to his employees.”

52. VI. Develop Cutting Edge Policies
State and Local Gun Laws:
• Before implementing a ban on weapons, check state and local laws.
– Many states have enacted laws that prohibit employers from enforcing
any workplace policy that would prevent their employees from storing
guns in their cars on a company lot:
• 2010 • 2007
– Indiana – Kansas (HB 2528)
• 2009 - Governor's veto overridden
– Arizona • 2006
– Idaho – Kentucky
– Montana – Mississippi
– Utah • 2005
• 2008 – Oklahoma
– Florida – Alaska
– Georgia – Minnesota
– Louisiana – Kentucky

53. VI. Develop Cutting Edge Policies
Weapons Policy
• If an employer decides to ban weapons in the workplace, the
policy should:
– Define terms such as “weapon,” “firearm,” and “possess”
– Clearly state the policy’s purpose
– State that, despite state and local law provisions that allow the
carrying of concealed weapons, the employer has elected to prohibit
weapons on its property
– Clarify whether the policy applies only to employees or to all persons
entering the employer’s premises
– Explain which areas are covered

54. VI. Develop Cutting Edge Policies
Weapons Policy – Drafting Tips:
• If an employer decides to ban weapons in the
workplace, the policy should also contain:
– A description of the employer’s policy on workplace
searches
– A statement that employees have no
reasonable expectation of privacy in their personal
work areas
– A signed, written acknowledgment of the policy
– Disciplinary consequences for violating the policy

55. VII.
Incorporate
State and Local
Legal Requirements
into Your Handbook
54

56. VII. Incorporate State And Local Legal Requirements Into Your Handbook
• Specified Personnel Policies
• Workplace Smoking Policies
• Voting Policies
• Jury Duty Policies
• Blood, Organ, and/or Bone Marrow
Donation Leave
• Protected Off-Duty Legal Activity
• Breastfeeding Accommodations

57. 56

58. QUESTIONS
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59. For an outline of legal reference materials
concerning the foregoing presentation,
please visit:
http://www.proskauer.com/files/uploads/Documents/shrm-2011.pdf
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