EMPLOYEE HANDBOOKS ARE CRITICAL TO PREVENT SUCCESSFUL EMPLOYEE LAWSUITS (PART 5 – Employee Benefits & Acknowledgement of Receipt)

This is the fifth article in a series explaining how Employee Handbooks play a critical role in preventing successful lawsuits. This post focuses on information on Employee Benefits and an Acknowledgement of Receipt that should be considered when writing an Employee Handbook.

Employee Benefits

An explanation of employee benefits should be spelled-out somewhere, whether it is in the employee handbook (or in a separate benefits handbook) is up to the employer.  If you choose to include it in the handbook, it should entail the following: (1) all of the employee benefits (e.g., holidays, vacations, sick days, paid/unpaid  leaves, insurance, long and short-term disability plans, COBRA, 401(k), other retirement plans, continuing education, jury  duty, bereavement);  (2) specific conditions to receive such benefits; and (3) limitations of the benefits (e.g., must have work scheduled day before and after holiday in order to receive holiday pay). Because employee benefits plans change frequently, the handbook should give general information and direct the employee to the individual plan documents.  Furthermore, so as to avoid confusion when the plan documents and the handbook are in conflict, the handbook should expressly state that the applicable plan documents control.

Acknowledgment of Receipt

You should also ensure that all employees who receive the handbook sign a form acknowledging that they have received the handbook and have reviewed the materials contained therein (and/or promise to promptly read and review it if there is not time to immediately read it when it is handed to them).  In your acknowledgment form, you may require that employees attest to having read and reviewed the handbook (or promise to read it), and have the opportunity to ask questions about any of the policies in the handbook.  You might also choose to require employees to acknowledge that they have received a copy of the handbook and have had the opportunity to review the materials contained within. Your acknowledgment form should include the same elements that you have included in your disclaimer at the beginning of the handbook.  In this way, all employees will have individually acknowledged in writing their understanding of the at-will nature of employment with the Company.  Make sure each employee signs and dates the acknowledgment form. Keep signed forms in each employee’s personnel file.  A signed acknowledgment form may become a key piece of evidence in future litigation.

You should require employees to sign an acknowledgment form at the beginning of their employment with the Company (possibly include in pre-employment documents), and also when the Company revises its handbook.  Companies that maintain centralized human resources policies and do not distribute handbooks to employees should require that employees acknowledge receipt of individual policies when such policies are implemented and distributed. Both disclaimers and acknowledgment forms are vital elements to an effective employee handbook. While similar in language, each of these pieces is important.

Sample:

Acknowledgment of Handbook Receipt

This is to certify that I have received the employee handbook and promise to promptly read it and become familiar with its contents.  I understand that it is not a binding contract but a set of guidelines for the implementation of personnel policies. I understand that the Company may modify any of the provisions of this handbook at any time, with or without notice, and may deviate from any provision of this handbook in its sole discretion.  I also understand that, notwithstanding any of the provisions of this handbook, I am employed on an at-will basis.  My employment may be terminated at any time, either by me or by the Company, with or without cause and with or without notice. I understand that no representative of the Company, other than the President, has any authority to enter into any agreement for employment for any specified period of time, or to make any agreement contrary to the foregoing.

Employee Signature

Employee Name (printed) & Date