As we’re growing our team here at The Legal Department, it reminds me how important it is to keep up with certain issues involving employees. For service businesses, having good employees is critical to the success of the business. There are so many rules to follow in employment law and they can appear overwhelming at times. However, this is one of the key areas for building business infrastructure and eliminating unnecessary risks.
As a lawyer, I know how critical it is to build this infrastructure and put these procedures into practice. As a business owner, I can relate to those who dread the tedious nature of these tasks and find themselves procrastinating. Because we are tackling these issues (again) as we expand, I’ve decided to share my own short list of top priorities in this area. Here’s my Must Focus List:
- Government Documents: The law requires that a business maintain certain documents on each of its employees. Among these are the Form I-9 (Verification of Employee Eligibility), Form W-4 (Employee’s Withholding Allowance) and the Florida New Hire Reporting Form (this actually gets filed with the state). All of these documents contain sensitive information on the employee (Social Security Numbers, Identification Numbers, etc.) and should be kept in a secured (preferably locked) location. There are many articles about businesses who did not comply with the requirements of these forms and the consequences they suffered. While I could write much more on the requirements of these documents, I’m shortening it down to two imperatives: Fill them out and keep them confidential. As a tagalong to this section, there are informational posters that must be displayed in the workplace. These posters are available free of charge from the government agencies that produce them. They are required and should be updated as needed.
- Employee Agreement: This is where I focus on the individual employee and the specifics of their particular employment. If an employee is promised employment for a duration of time, an Employee Agreement usually specifies the contract dates of employment. Otherwise, if the employee is “at-will” and can be terminated for any reason at any time, then, in Florida, a written Employee Agreement must state the magic language to keep it that way. In either situation, an Employee Agreement is a good idea for several reasons. Most service businesses have confidential information of some sort from their clients. Therefore, requiring employees to sign a non-disclosure agreement is critical to meeting obligations to the client. If an employee has a lot of contact with clients, it may also be smart to include a non-solicitation provision. While non-compete provisions are necessary in certain circumstances, they should be very limited in use and only if the criteria has been met. Often, a non-solicitation provision is more appropriate. Employee Agreements can also include provisions about the particular position, such as travel, promised vacation time, and other benefits. At the very least, it’s good practice to have an Employee Agreement that contains a non-disclosure provision.
- Employee Handbook: It’s a good idea to have one of these even though the law does not require it. This document is a set of rules, policies and procedures that all employees need to know and follow. Without them, employees may not know what is expected of them and unnecessary problems could occur. Each employee should receive a copy of the handbook and sign an acknowledgement of receipt. While an employee handbook can be very lengthy and cover many topics, it doesn’t have to be. An employee handbook can simply contain the most common policies of a business. Below are some examples:
- Requesting time off,
- Calling in sick,
- Scheduling lunch breaks,
- Dress code,
- Expense reimbursement,
- Use of personal phones during business hours,
- Accessing the internet on company computers,
- Drug-free workplace provisions,
- Parking instructions,
- Anti-harrassment standards (big in the news!),
- Keeping of timesheets,
- And many others that may be prudent to include.
A word of caution though – make sure the handbook is accurate. It will also serve as rules the business must follow. If the handbook contains wrong information for whatever reason (a mistake, information is outdated, things changed, etc.), then the business will likely be stuck with what is actually in the handbook. Bottom line: If a business has an employee handbook, it should be kept current and accurate by reviewing it at least once per year.
Please realize that there is much more to employment law than discussed in this blog post. For me, having the information organized in these three categories allows me to understand their importance. Keep in mind that you will need to consult an experienced attorney and/or a human resources professional for help with your particular business needs.
About Elevate Business Law: At ELEVATE, we help business owners do risk assessments. We aren’t coming from a “no risk is good” perspective because we know that some risk is necessary in business. Our main goal is to help business owners avoid unnecessary bad risks and make better business decisions.