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How Can My Small Business Avoid Employee Problems?

Posted by Jonathan Krems | Dec 13, 2021 | 0 Comments

In today's Freedom Friday blog and email newsletter, I want to discuss one more rarely asked question, and that's how your small business can avoid employee problems.  If your small business has employees (not independent contractors), then you need to take steps to protect you as the small business owner, and also your small business.  I recently talked with a manager in a local small business based in the Oklahoma City area, and he informed me that the business he worked for did not have a policies and procedures manual, or an employee handbook.  The biggest step you can take to avoid employee problems is getting a policies and procedures manual, or an employee handbook.  So, in today's Freedom Friday blog and email newsletter, I want to answer the question, “How can my small business avoid employee problems?”

As I mentioned earlier, the number one way to avoid employee problems in your small business is to implement a policies and procedures manual, or employee handbook, in your small business.  If you have any employees at all, this is a must!  A business attorney can help you draft a simple employee handbook for your small business.  Here are five (5) essential elements for every employee handbook:

1.  Introduction

The first essential element for an employee handbook is an introduction.  This is a simple statement that explains what the handbook is and how it should be used.  You need to explain that the employee handbook is not a contract, but it is a convenient place for your employees to find out information about their employment with your small business.

2.  Equal Employment & Discrimination Policies

The second essential element for an employee handbook is equal employment and discrimination policies.  If your small business is a brick-and-mortar operation (you have a physical location where employees come to work), then you are required by the U.S. Labor Department to post information which says your small business follows all federal equal employment opportunity and non-discrimination laws.  It is especially a good idea, even if you are not a brick-and-mortar small business, to also place this information in your employee handbook.

3.  Worker's Compensation Policies

The third essential element for an employee handbook is your small business's worker's compensation policies.  Any information regarding these policies should be in your employee handbook.  Even if your small business is self-insured, you still need to develop worker's compensation policies and include it in the employee handbook.

4.  Paid Time Off Policy

The fourth essential element for an employee handbook is the paid time off (PTO) policy.  This is also known as your small business's vacation policy, and whatever PTO or vacation time you allow for your employees should be discussed in your employee handbook.  This policy should include how much time an employee can take off, how an employee can earn additional time off, and how an employee can request time off.  Any other particular details specific to your small business's PTO policy should be included.  You should also include information about sick pay and similar policies, as well.

5.  Employee Behavior

The fifth essential element for an employee handbook, and this is the most important of all, is your small business's employee behavior policy.  Going back to the manager I talked about earlier, he told me their employee behavior policy was summed up by saying, “Just have common sense.”  If you are interested in protecting your small business from liabilities, “common sense” is not good enough.  Employee handbooks should discuss any policy regarding behavior or conduct of your employees that is either encouraged (positive behaviors) or prohibited (negative behaviors).  These policies would include everything from dress codes, work schedules, communicating with fellow co-workers, how to report inappropriate behavior, etc.  This is the most important aspect of any employee handbook, and these policies need to be comprehensive enough to protect your small business from liabilities.  This is why having an attorney involved in the creation or improvement of your small business's employee handbook is a wise investment for your small business.

If you are interested in starting a small business anywhere in Oklahoma, or you need legal help building, protecting, or defending your small business, please contact me at [email protected] to schedule a FREE strategy session.

For more information about Liberty Legal Solutions, LLC, please visit our website at

About the Author

Jonathan Krems

Jonathan is the Founder and Managing Attorney of Liberty Legal Solutions, LLC, a law firm dedicated to building, protecting, and defending the business and personal interests of our clients in Oklahoma.  Jonathan's primary practice areas are business law, contracts and agreements, business liti...


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