By: Gregory Currey, Partner, Wright, Constable & Skeen LLP
How many of you have seen this on tv before – a lawyer drafting a contract puts a comma in the wrong place, costing his client millions of dollars and sabotages a deal? While you may not think this could happen with your employee handbook, I’ve seen it before: employers put in policies that make sense or look professional but contain illegal provisions or provide benefits that they did not intend. While many of these may not cost your company millions, most employment laws provide for an employee to recover attorneys’ fees or proceed as a class, which can quickly escalate the cost of any errors.
When reviewing an employer’s handbook for the first time, I see a number of common issues. Many employee handbooks provide for vacation pay for employees. However, under Maryland law, unless the handbook contains an express disclaimer that the employer does not pay out accrued, unused vacation upon termination, employees are entitled to be paid for that time. Another question is how unapproved overtime is handled? If your employee handbook states that employees are not paid for unapproved overtime and you follow that policy, you could be creating liability for yourself even though the policy makes sense from an employer’s standpoint – after all, the employee broke the rules, why should he be rewarded? There are legal ways to handle this issue but nonpayment is not one of them.
Another issue I frequently see arises out of “cut and paste” handbooks – employers do an internet search for specific policies, find language, and put it in their handbook with minimal modification. If you have fewer than 50 employees but cut and paste a Family and Medical Leave Act policy into your handbook, even though you are not covered by the law, the courts have stated that you’ve opted in to that law. If you do not have a unionized workforce but cut and paste employee-friendly policies that were collectively bargained for by another employer, you may again be providing benefits to your employees that were more generous than you intended.
These are just a few examples of many issues that I see but they all point to the same conclusion: having an experienced employment attorney conduct a review and update of your handbook to make sure it is current and compliant with laws may cost your company a few thousand dollars but over time, it can save you hundreds of thousands of dollars, not to mention hours of headaches.
Upcoming Seminar:
Greg will be going into much greater depth on this topic, when he speaks on September 18th, 9 – 1 am – “Legal Seminar: Employee Handbook & Policies.”
For more information, or to register, click here.
This seminar offers 2 hrs. CE through HRCI (Human Resources Certification Institute) and 2 hrs. CE through SHRM (Society of Human Resources Management)
Gregory Currey is a Partner with Wright, Constable & Skeen, LLP. Mr. Currey is an experience counselor and litigator who focuses his practice on employment and business issues. He regularly works with employers to develop policies and practices to avoid litigation and represents employers when litigation is unavoidable. Mr. Currey is a frequent writer and lecturer on employment law.