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Human Resources HandBook: Key Docs Tech Companies Need to Manage Workers

Thursday, March 28, 2013 6:12

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(Before It's News)

By Peter J. Ennis, Esq., Buchanan Ingersoll & Rooney, PC

[email protected]

I. Why Documents Are Important.

As an employment lawyer with 30 years of experience, I have handled hundreds of employment-related lawsuits and counseled employers regarding innumerable critical employment decisions. As a result of that experience, I have often observed that many cases or situations would be easier to handle if the client was not involved, just the documents. Why? People forget things. Employees will do things incorrectly because they do not know what the rules are or what is expected of them. Two people observing the same conduct or hearing the same thing will often interpret or experience what they see or hear very differently depending on their background and bias. Therefore, they will remember what was done or said differently. Next, unfortunately, some people simply do not tell the truth. In each of these situations, having documents that are prepared in advance or are recorded contemporaneously with the events can be invaluable to set expectations, help both managers and employees work through a problem in a constructive manner and, if it goes that far, protect the employer against claims that it violated the law. If those were not sufficient reasons to demonstrate the importance of documents, then employers must be aware that the law requires certain documents to be made and kept.

Given the benefits of having some documents, why don’t all employers have a complete set of employment-related documents? The following are some typical reasons for this:

- The employer is small and has just started its business. It is focused on funding and becoming profitable.

- The employer is a small or mid-sized company, and the founders or senior managers believe they know all the employees well enough that they can work out any issues on an individual, personal basis.

- The human resources function is handled by a financial person or another manager without experience in human resources and they do not see the value of such documents.

- The employer does not want to be bound by rules or forms. It wants to retain the discretion to handle things based on the individuals and particular circumstances involved.

- The employer does not want to spend the time and expense to develop the documents and train its managers and employees on their use.

Each of the foregoing situations is understandable. However, I do not think they hold up to closer scrutiny. While the small employer that is just starting out may not need a highly developed employee handbook, wouldn’t it benefit from having documents that would help ensure that it has hired qualified people, who know what is expected of them?

The employer where the founders or senior managers believe they know everyone well enough to be able to handle every situation is a problem because there is no baseline. Every situation is handled based on the particular perspective and experience of the founder or senior manager. This creates a breeding ground for mistrust, lack of consistency and potentially unlawful conduct.

In the situation where a finance person or some other manager is handling the human resource function, or the employer simply does not want to invest the time and expense of developing such documents, it is usually a matter of showing the value of particular documents. You have to be able to show what the return on investment is of having such documents. If the documents at issue avoid even one lawsuit every three years, the time and expense put in up front will be well worth it, and that does not include the benefits of hiring more qualified employees and making better employment decisions.

The employer that wants to retain complete discretion and not be bound by rules or documents does not understand how good documents are written. If you ask the manager who wants to retain discretion if they also want to act in an arbitrary way, they will say “no.” That is not good for the business. Good documents can, and should, be written in a manner that retains discretion, but eliminates “arbitrary” decision-making.

II. What Qualifications Does An Employment Lawyer Have to Discuss What Documents Are Important?

I believe I have three critical qualifications that allow me to address this topic. First, why do employees or applicants sue their employer? While the lawsuit may alleged “discrimination,” “wrongful discharge,” or “breach of contract,” there are generally four underlying reasons that an employee or application sues: (1) they are surprised by the decision; (2) they feel the employer has treated them unfairly; (3) they feel they have no choice because they have no income; and (4), they are malcontents and they sue because they want to. While there is nothing employers can do about people in category “4″, the cases involving people in categories “1″ and “2″ are generally focused on documents, or the lack thereof.

Second, what is involved in most employment lawsuits? Once again, on its face, the lawsuit may allege “discrimination,” “wrongful discharge,” or “breach of contract.” But rarely is there evidence that the manager said something like, “I think you are too old to work here.” Without such direct evidence, to prove those claims, the plaintiff must rely on personnel practices and how the employer treated similarly situated employees. Documents are critical to both of those issues.

Third, I have seen too many cases where employers have been hurt either by their lack of documents or by documents which did not support the position they were taking in the lawsuit. I believe that experience is critical in helping employers determine what documents are important and why.

III. What Makes An Employment Document Important?

Based upon the foregoing, in determining what documents are important, the document must serve at least one of the following purposes:

It puts the employee on notice of what is expected of him or her.
It enhances the ability of the employer to make an effective decision.
It enables the employer to act fairly and consistently, given the particular circumstances involved. In regard to the latter point, if the employer appears to be acting inconsistently, the document should explain why.
It enables the employer to comply with its record-keeping requirements under the law.

IV. One Employment Lawyer’s View Of What Employment Documents Every Employer Should Have.

I want to begin by stating that not every employer needs to have all of the documents I discuss immediately. Although the sooner they have them, the better, I understand that for the reasons set forth above, there will be some push back on certain documents by certain employers.

In addition, I do not believe that a particular document must follow a particular format. Do not be put off if you are unsure whether you are drafting a particular document “correctly.” As long as you address the basic concepts I describe with each document, then the language, formatting and length of the document can be very flexible.

Next, I want to note that this list is based on my personal views. I am sure there are people who disagree with some of the documents I have listed, or who might say I omitted key documents. I wanted to keep the list limited so that managers would not feel overwhelmed by the number of documents they should create and maintain.

Finally, it will be immediately apparent that I have not included a confidentiality or non-compete agreement. Obviously, those are critical documents and can be addressed in a future article. My list focuses on more of the traditional employment documents that a technology company may not have or may not consider important.

With the foregoing mind, I am going to be addressing the following documents: