Labor Manual

Provide a personnel manual for your practice to set guidelines and protect against any HR disputes

What is the difference between a policy manual and a personnel one? Policy manuals are generally accepted to mean a publication to convey the operating parameters of an organization. It is a guide for the use of management personnel. It is not, however, meant for all employees. A personnel manual, or the human resources (HR) handbook, delineates the procedures, rules, and practices for most of employees.

How many employees necessitate an HR manual? Some HR experts feel that a formal manual is not necessary until you have at least five employees. I disagree. My opinion is based on the two main reasons for having a manual.

One, the federal and state codes that regulate labor start applying as soon as you hire your first employee. Therefore, you are responsible for consistently applying labor laws from the time that you hire your first employee. The key word is consistently.

Two, as you continue to add employees, various labor laws come into play. Are you aware which labor laws come into effect for a two-, five- or 15-person staff?

This is why I believe that DCs should have, at minimum, a professionally written set of HR rules and regulations for their first several employees. At the same time, if you intend to grow and hire more personnel, you should start working on arrangements for a HR manual.

An important cornerstone when building a strong and productive staff is to have methods that will guide your staff to solve the problems they will encounter.

The manager who tells employees, “I’ll get back to you on that problem,” and does not, only creates unmotivated employees and potential for larger problems later. Employees must have directions on how they can solve problems. A comprehensive policy manual is an essential tool for helping your team resolve their office-policy questions.

Remember that a policy manual is an easy way to communicate the complex rules under which business is required to function. Care has to be taken not to expose your practice to unnecessary legal complications brought on by the failure to adhere to governmental regulations.

Lastly, and most importantly, both functionally and legally, an HR manual provides guidelines for dispensing information and answering questions in a consistent manner.

One of the ways DCs can get into labor law trouble is by inconsistently applying the rules to their employees. The employer stands a good chance of losing the legal battle if it is shown there was inconsistency in the way they treated one employee over another.

A Good Resource
If you attempt to put together an improperly constructed HR manual, you might as well place a time bomb in your reception area. If there is a dispute, your personnel handbook or HR manual could be construed as an implied employment contract. An implied contract, in effect, guarantees certain policies and benefits that could prove to be costly.

Be wary of software programs or fill-in-the-blanks policy manuals. These by-the-number systems are inadequate. You need to keep current with the rapidly changing regulations that are constantly being issued by state and federal governments.

The best way to put together a legal yet understandable company policy manual is to hire a labor HR expert.

After creating your personnel manual, an annual review by an HR expert is recommended. The cost of a manual, when amortized over a year, compared to the cost of legally resolving personnel problems turns out to be quite reasonable.
I was fortunate to know an HR expert, who worked for a large local company. She compiled a policy manual and updated it once a year. Her consulting services were an excellent investment. She charged us a flat fee for the original plus an annual fee for updating it. There were no fees charged for any questions during the year or for any changes made to clarify wording.

All employees were then required to read it (on company time). Afterward, they were asked to sign a statement indicating that they had read and understood it. A copy of the manual was always available in the office for reference. If a staff member brought up a policy question, he was first referred to the manual. This saved me a lot of time answering questions about sick days and vacations.

If the same questions were perpetually brought up, I made that one of the subjects of a staff meeting. Of course, if the issues were not adequately resolved, I had a meeting with my HR expert to make the appropriate manual modifications.

The subjects covered (see sidebar) are extensive. Each section is outlined in great detail with references to the applicable labor laws. There were questions that touched on almost every subject in our manual, and I changed and updated the manual as necessary.

The guidelines that were most helpful were vacation pay, job classifications, personal leave, and the rules governing progressive discipline.

Disciplinary matters were handled in an equitable manner because all the appropriate steps were outlined in the policy manual. Those steps had been read and acknowledged by the employee, therefore uncertainty was removed from the disciplinary equation.

Nevertheless, even the most professional policy manual does not totally eliminate legal confrontations. I was challenged by an ex-employee regarding her termination and vacation pay. The judge dismissed the case after reivewing the relevant sections of my HR manual that addressed the disputed issues and the form signed by the ex-employee indicating that she had read and understood the manual.

An unfavorable ruling would have cost us a substantial amount in back and vacation pay. That favorable decision paid for the cost of our manual (including the updates). CP

Ivan Delman, DC, is the author of The Business of Chiropractic: How to Prosper After Startup and has degrees in both business and chiropractic. After working 20 years in each field, he has retired to write and travel. Delman’s free Chiro-Biz newsletter and other articles can be found at: www.businessofchiropractic.com. He can be reached via email: ivan@businessofchiropractic.com.

The information in this article is intended for informational purposes only and does not constitute any legal advice whatsoever. Consult a certified human resources expert in your state for more specific information.