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Does Your Handbook Have One of These Turkeys? 12 Policies to Avoid

When determining which workplace policies to adopt and which to avoid, it's important to take into account all applicable federal, state, and local laws. To help, here are 12 common policies that are potential "turkeys" along with what you may want to consider instead.

Avoid #1: Blanket policy on criminal convictions.

Blanket policies barring candidates with criminal convictions can disproportionately affect minorities and other protected groups and may violate the law. For instance, some states protect employees who have been convicted of a crime unless the conviction relates to the individual's job duties. The Equal Employment Opportunity Commission (EEOC) says that an employer cannot simply disregard a candidate because they've been convicted of a crime.

Best practice: Don't automatically take an adverse employment action against an applicant or employee because of a criminal conviction. Instead, evaluate how the specific criminal conduct relates to the duties of a particular position. When making this assessment, consider a variety of factors, such as the facts and circumstances surrounding the offense, the timing of the offense, the number of offenses for which the individual was convicted, rehabilitation efforts, and employment or character references. See the EEOC's guidance for more information, review applicable laws, and seek legal counsel before making employment decisions because of a conviction.

Avoid #2: Withholding final pay until company property is returned.

As a general rule, you can't withhold final pay until an employee returns company equipment. You must meet the applicable final pay deadline even if the employee hasn't returned company property. Federal law requires final pay at the next regular payday, but several states have their own rules, some of which require final pay at the time of termination.

Best practice: Whenever possible, reclaim company equipment prior to the employee's last day. While withholding an employee's final paycheck isn't permitted, there are some cases in which deductions may be allowed under federal law. For non-exempt employees (employees who are entitled to minimum wage and overtime), the Fair Labor Standards Act (FLSA) permits deductions for unreturned equipment as long as it does not reduce the employee's pay below the minimum wage and doesn't cut into any overtime pay due. Some states prohibit this practice or have additional requirements, so check your state law before making a deduction. Deductions for unreturned equipment aren't permitted for employees classified as exempt from overtime.

Note: Under the FLSA, employers are generally required to obtain an employee's consent before making a permissible deduction. The agreement must specify the particular items for which deductions will be made (such as company uniforms, equipment, or employee theft) and how the amount of the deduction will be determined. It's a best practice to obtain the employee's authorization in writing and consult legal counsel before making a deduction.

Avoid #3: Unauthorized overtime/early punch-ins will not be paid.

Under the federal FLSA, non-exempt employees must receive 1.5 times their regular rate of pay for all hours worked over 40 in a workweek (some states require overtime in additional circumstances and at a different rate). If a non-exempt employee has worked overtime, they must be paid an overtime premium, regardless of whether the overtime was pre-authorized. A policy that no overtime work is permitted unless authorized in advance doesn't relieve the employer of this requirement. Similarly, employers may not withhold pay for time worked if the employee punches in before their scheduled start time.

Best practice: Employers may subject the employee to disciplinary measures for working unauthorized overtime, but in no case may the employer withhold overtime pay.

Avoid #4: Comp time instead of overtime.

Offering paid time off to non-exempt employees instead of overtime pay, a practice known as comp time, is prohibited in the private sector. Employees can't waive their right to overtime, even if the employee would prefer comp time instead.

Best practice: Accurately track all non-exempt employees' hours and pay them overtime whenever they work more than 40 hours in a workweek (and in any additional circumstances required by your state law, such as possible daily overtime).

Avoid #5: Requiring a doctor's note for every sick day.

Most leave laws allow employers to ask employees for reasonable documentation of the need for leave. However, certain laws do have restrictions. For example, some state and local paid sick leave laws prohibit employers from requesting documentation unless the employee has taken sick leave for more than three consecutive days.

Best practice: Even in the absence of a restriction, consider what, if any, documentation would be reasonable to require from employees, and apply your policy consistently. Also keep in mind that certain laws limit the type of medical information an employer can request, and any medical documentation or health information received must be kept confidential and separate from the employee's personnel file.

Avoid #6: Prohibiting lawful off-duty conduct.

Several states prohibit employers from taking adverse action against employees and applicants who use tobacco. Some protect employees who use marijuana while off-duty. Additionally, a few states expressly prohibit employers from taking adverse action against individuals on the basis of any legal off-duty conduct.

Best practice: Even if your state doesn't expressly protect employees from legal off-duty conduct, it's not considered a best practice to have a policy limiting lawful, off-duty conduct.

Avoid #7: Safety bonus based on days without an injury.

A safety-incentive program that rewards employees with a prize or bonus at the end of an injury-free period may violate certain laws, since these programs may discourage employees from reporting an injury or illness. A statement that employees are encouraged to report and will not face retaliation for reporting may not, by itself, be adequate to ensure that employees actually feel free to report.

Best practice: If employers have an incentive program, OSHA recommends they adopt other measures to ensure employees feel comfortable reporting workplace injuries, such as:

  • A program that rewards employees for identifying unsafe conditions in the workplace;
  • A training program for all employees to reinforce reporting rights and responsibilities and emphasize the employer's non-retaliation policy;
  • A mechanism for accurately evaluating employees' willingness to report injuries and illnesses.

Avoid #8: Pay secrecy.

Under Section 7 of the National Labor Relations Act (NLRA), employees have, among other things, the right to act together to improve wages and working conditions and to discuss wages, benefits, and other terms and conditions of employment, with or without a union. The National Labor Relations Board (NLRB), which enforces the NLRA, and many courts have found that pay secrecy or pay confidentiality rules violate Section 7 rights. Additionally, some states and local jurisdictions prohibit pay secrecy policies.

Best practice: Never take action or implement policies that could be construed to restrict employees' rights under the NLRA. Instead, consider taking steps to better communicate information about your company's compensation program and how employees' salaries and wages are determined.

Avoid #9: Probationary/introductory periods.

Probationary or introductory periods are sometimes used to assess a new hire's performance, but can lead to confusion regarding "at-will" status. At-will generally means that either the employee or the employer may terminate the employment relationship at any time, for any lawful reason. When employers use probationary periods, employees sometimes think that once they successfully complete a probationary period, they are no longer at risk for termination based upon their performance. This misunderstanding can lead to increased risk of wrongful termination claims. Additionally, the term "probationary period" may have a negative connotation. New hires may misinterpret "probationary" to mean that they are immediately placed on a disciplinary action plan at the start of their employment.

Best practice: Whether it's an "introductory period," "training period," or "orientation period," they all generally run the risk of confusing employees about their employment status. Instead, create a development plan, set clear performance goals, and hold regular check-ins with all new hires to ensure they're meeting performance expectations.

Avoid #10: No-fault punctuality and attendance rules.

No-fault policies can be problematic since they generally subject an employee to a specific form of discipline if they are absent or tardy a certain number of times, regardless of the reason. These types of policies are problematic if one or more absences are protected under federal, state, or local laws and the employer still counts the absence against the employee. For example, employees who have the right to take leave under the Family and Medical Leave Act, a state or local paid sick leave law, or the Americans with Disabilities Act cannot have that leave count against them when evaluating their attendance (or performance).

Best practice: Employers are permitted to adopt a policy that subjects employees to discipline for excessive, unapproved absences, provided that employees are never subjected to adverse action for taking leave to which they are entitled under federal, state, or local law. If you adopt a policy, make sure you have safeguards in place to avoid violating these laws.

Avoid #11: Discipline policies that lack flexibility.

Disciplinary action provisions should give the company flexibility to take action based on the facts and circumstances of each case. If drafted incorrectly, discipline policies may lock you into taking one course of action, such as policies that indicate a verbal warning will be given for all first offenses, a written warning for all second offenses, and so on (commonly known as progressive discipline).

Best practice: Avoid policies that restrict your ability to decide what type of discipline is appropriate given the severity of the offense and the employee's history of misconduct. State that violations may result in disciplinary action, up to and including termination, and that the company reserves the right to decide what disciplinary action to take in any given situation. Keep in mind, however, that treating employees fairly is key and similar situations and past practices should guide and impact the disciplinary action that you take.

Avoid #12: English-only policies.

The EEOC has taken the position that rules requiring employees to speak only English in the workplace violate federal law unless they are reasonably necessary to the operation of the business. Policies that require employees to speak only English in the workplace at all times, including during breaks and meal periods, will not likely be considered reasonably necessary.

Best practice: Employers that believe an English-only rule is reasonably necessary to the operation of their business should consult legal counsel to determine whether it is permitted. If permitted, apply the rule in limited circumstances and only when it is needed to operate safely and efficiently.

Conclusion:

With federal, state, and local laws as your guide, make sure you carefully consider what policies to include and what policies to avoid in your employee handbook.

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