Employee Handbooks and Manuals

Employees often provide standardized instructions to employees through the use of employee handbooks or manuals. These handbooks allow the employers to train a large number of employees without the use of individual training. These handbooks can set forth the employer’s standard employment practices and establish the expectations of employees. Provisions in a handbook or manual may include descriptions of the following examples:

  • Compensation of employees
  • Health and other benefits offered to employees
  • Work hours
  • Overtime
  • Leaves of absence
  • Holidays
  • Vacation time
  • Rules of expected behavior
  • Discharge
  • Discipline and disciplinary procedures
  • Grievance
  • Promotion

Until the 1980s, courts seldom enforced the terms of an employee handbook as a contract. In many instances, handbooks do not contain language that a court would construe as promissory in nature. However, courts in the 1980s began to recognize that language in these handbooks may bind the employer contractually. The majority of jurisdictions now recognize an employee handbook as an exception to at-will employment.

A number of issues may arise in the context of employee handbooks. Many cases involve a question of whether an employer may fire an employee and, if so, whether the employer followed the proper procedures in firing the employee. Cases involving employee handbooks often turn on whether the language in a handbook is sufficiently specific. For instance, if a handbook sets forth a list of reasons why an employer may fire an employee, courts will likely find that this language binds the employer. On the other hand, if a handbook is vague about reasons for a discharge, courts are more likely to determine that the relationship is at will.

Where an employer includes language indicating that an employee handbook does not constitute a promise or a contract, courts usually rule in favor of the employer. In such an instance, the courts require that the disclaimer is clear and unequivocal, that it is placed conspicuously, and that the disclaimer is communicated to the employee.

Inside Employee Handbooks and Manuals