Hiring a great employee that adds to the culture of your small business can be a challenge, but keeping them can be even harder—especially amid an unprecedented labor shortage. In 2021, 50% of small business owners reported that it was a challenge to find qualified workers compared to 2020.
With so many options available for job seekers, it’s more important than ever that employers communicate their business values and stand out from the crowd. Establishing your brand — how employees and prospective employees perceive you — starts with onboarding, and constitutes a key part of your overall retention.
As you develop retention strategies for your business, creating an informative employee handbook should be at the top of your to-do list. It’s a cost-effective way to give new hires an organized onboarding experience and set your team up for success with all the information they need to know to perform their jobs well.
For all industries, an effective employee handbook can be the key to building a team of engaged employees. Remember to consult with your management team and legal counsel to make sure your handbook covers all the bases of your operations and legal obligations. Here are some tips to get you started.
Why small businesses need an employee handbook
The best employee handbooks give insights into everything new hires and existing team members need to know to thrive on the job. Though different small businesses have different needs, the general structure of an employee manual stays the same. For example, a restaurant employee handbook may include details on proper table settings and food safety, while a manual for a grocery or convenience store might include information on stocking and maintaining store standards.
Here are the primary benefits of a small business employee handbook:
It fosters a strong work culture and gives employees a sense of belonging.
It keeps all employees aligned on important policies and expectations.
It serves as an accessible resource for employees.
It can provide valuable legal protection for you and your business.
Elements of a successful employee handbook
Blending brand story, training materials, and evergreen policy information is a winning combination for an effective employee handbook.
The small business employee handbook template is designed to help you quickly and easily create a valuable resource for your team. It includes a basic outline of what’s needed, but is designed to be fully customized so you can make it your own. Remember, for your handbook to be successful, it should reflect your business values and culture.
Welcome letter & introduction
Create a strong first impression for new hires with an inviting welcome letter. An employee handbook contains many strict policies and can seem intimidating, so adding in bits of character that reflect your culture can inspire and put team members at ease, while giving them a better understanding of how your business operates on a daily basis.
Similarly, the introduction section allows you to tell all employees your story, from the founding of the company to your guiding principles. Give insights into what drives you and how your staff fits into the narrative. An introduction can include:
An overview of your company. Share how the business began, what goals you have for the future, and your mission and values. This is also a great place to explain the name of your business, especially if it’s a question your team gets a lot from customers.
Basic information for quick reference. Include any information that employees will need to know quickly, such as hours of operation, the nearest parking, phone number, address, etc.
Relevant employment policies. Many handbooks include employment policies explaining at-will employment and equal employment opportunity close to the front so employees are aware right away.
Conduct & behavior
Though you may live and breathe your business, you can’t have eyes everywhere at all times. By hiring people who share the values you listed above and providing them with a code of conduct, you empower them to do their jobs effectively, safely, and with the business’s goals in mind. This may be one of the most important sections of your handbook, so be thoughtful about including comprehensive information, such as:
Details about the dress code and uniform. Outline the specifics of what you expect your team to wear and what’s not allowed. Be sure to include any policies dictated by health or safety codes, like avoiding open-toe shoes.
A code of conduct. Setting your expectations for your team through a code of conduct gives employees the autonomy to make decisions on their own. A strong code of conduct leans on your company’s values and explains what behavior is unacceptable.
Any absence or lateness policies. If you expect employees to arrive early to get settled, they need to know that. Outline any lateness or no-show policies you have so team members can plan accordingly and communicate with you or a manager as needed.
What constitutes a fireable offense. Although it can be nerve-racking to think about getting fired, employees deserve to know your expectations from day one. Tell new hires what behavior isn’t tolerated early on to establish a mutual understanding right off the bat.
Daily operating procedures
New hires will soon get the hang of what an average shift is like, but list expectations and operating procedures to help things run smoothly from the beginning. Ask floor managers for input on this section to improve its accuracy and effectiveness. Here are a few things to consider:
Your expectations for opening, closing, and service. Provide any must-know information about what a shift typically entails, including side work responsibilities, to ensure everything gets done as needed.
Details about meals and breaks. Let employees know when and/or where they are allowed to take a break and when family meal is served, if applicable.
Any relevant discounts or perks. Your team puts a lot of time and energy into helping your business succeed — show them your gratitude with additional perks or discounts. Let them know how and when these benefits can be redeemed, and clarify whether they can be shared with friends and family.
Communication & workplace safety
Give your team the tools they need to communicate effectively and safely. A strong communication policy may also outline how employees should talk about your business on social media and possible repercussions. Since many workplace safety precautions vary from business to business, work with your managers to make sure you include the most important ones for your team. Here are a few points to mention:
How and when you send out the schedule. Do employees need to download an app or check their email on a certain day to get the schedule? Make sure all staff members know when and where to find the schedule, and spell out any abbreviations for them.
Any COVID-19 or health precautions. Explain what your policies and/or local regulations are for COVID-19, such as mask or vaccine requirements. This is also a good place to include vital health precautions, like where you keep a first aid kit or what employees should do in case of emergency.
Important information about workplace safety. Include any information pertaining to relevant safety, including food safety, health department standards, and necessary equipment or attire.
Pay & benefits
Don’t be surprised if employees make a beeline to this section. They’ll want to know the details surrounding when they get paid and what benefits you offer, so providing this information in the handbook saves you from answering the same questions repeatedly. Use this section to include:
How and when employees get paid. Explain your payroll schedule so employees know when to expect their paycheck (weekly, bi-weekly, monthly, etc.) and if they will get it via check, direct deposit, or another form of payment. You can also explain how you split tips, if applicable, and give details on overtime or bonuses.
Any holidays when you are closed and how staff can request time off. If you’re always closed for certain holidays, like Thanksgiving and Christmas, list those out for your team. Likewise, if you remain open for popular holidays, include how scheduling is determined or if there is additional holiday pay offered for those dates. This section should also explain how employees can request time off.
Details on leave policies. Depending on its size, your business may be required to offer leave under the Family Medical Leave Act (FMLA) for qualifying employees. Detailing any policies you have pertaining to sick leave, family leave, or any other extended absence can help your team members prepare for instances when they need time off. If you offer paid leave as a benefit, let employees know how this time is earned and when they qualify.
Information on insurance benefits, if applicable. Under the Affordable Care Act, businesses with more than 50 employees are required to provide health insurance for staff members. If this applies to you, or if you are smaller and offer insurance, give details on what insurance is offered, when employees are eligible for coverage, and how they can enroll.
Anti-harassment & anti-discrimination
Including an anti-harassment and anti-discrimination policy is a smart legal choice that benefits your team. It reassures employees that you do not tolerate harmful workplace behavior and protects employees who may feel the need to report any such events.
You’ve put a lot of effort into writing this employee handbook — now it’s time to make sure your team reads it. Give them time on their first day to review the policies and ask questions, then ask for their signature to confirm they understand your expectations.
How an employee handbook can boost retention
Not only is the hiring process costly — but it can also cause wear-and-tear on your existing team and impact overall employee morale. Providing new hires with a solid foundation of your culture and each role’s responsibilities gives them the tools they need to eagerly begin a new job.
Additionally, an employee handbook serves as a branding communication tool. An emphasis on your business’s values and a clear explanation of the benefits of the job can be a vital component to ensuring employee longevity — and help you stand out.
Download the small business employee handbook to quickly create the resource your team needs to succeed today.