An employee handbook is a document that outlines a company’s policies and procedures, employee benefits, rights and responsibilities, and general expectations for employees. Whereas an employee handbook lays out a company’s policies at a high level, a policy and procedures manual, also referred to simply as a policy manual, dives deeper into those policies, often including procedures on how to carry them out.
Here’s how these documents differ:
- Code of conduct: Outlines expectations for employee behavior as well as a company’s ethics and values. Often included in a company’s employee handbook, but can also be a standalone document.
- Policy and procedures manual: Outlines detailed descriptions of a company’s policies as well as procedures for carrying those policies out. Depending on the contents, it may be intended for use by employees, managers/supervisors, the HR team, or some combination thereof.
- Standard operating procedures (SOPs): Step-by-step instructions for carrying out certain tasks or processes. Often included in a company’s policy and procedures manual, but can also be standalone documents.
For most small businesses, an employee handbook is a great place to start. You can always create a policy and procedures manual or add more in-depth procedures to your handbook as your company’s—and your own!—needs change and evolve. Required policies and procedures, however, shouldn’t wait.
Note that these terms aren’t used consistently. For example, some companies might refer to their employee handbook as their “policy manual.” What matters is knowing what’s included in each of your HR-related documents, who they’re intended for, and making sure policies and procedures aren’t inconsistent across documents.
Don’t forget to review and update HR documents as needed. Any time there’s a change to a policy or procedure, update the relevant documents, share those changes with affected employees and managers/supervisors/the HR team, as applicable, and request updated acknowledgments if needed.
What Is an Employee Handbook?
Intended for: Employees.
Outlines: Company policies and procedures, employee benefits, rights and responsibilities, and general expectations for employees.
Tone: Welcoming and accessible.
Employee handbook contents may include:
- Company mission, vision, and values.
- Employment application and hiring practices.
- At-will employment statement, where appropriate under applicable law and agreements.
- Company policies employees should be aware of, such as equal employment opportunity, anti-harassment/anti-discrimination, safety, dress code, social media use, and personal use of company equipment.
- Employee benefits information, such as health insurance, parental leave, and student loan repayment assistance.
- Information on scheduling, timekeeping, time off—including accrual and requesting/approval processes—attendance and tardiness, and breaks.
- Information on compensation, such as pay frequency/schedule and how to access paystubs.
- Employee performance management processes, such as performance reviews, employee recognition programs, and progressive discipline procedures.
- Employee offboarding process.
Note: Depending on your locations, workforce, and industry, you may be required to have certain workplace policies in writing and/or share them with employees. Check with your HR professional or employment attorney about applicable requirements. For example, some states require covered employers to have an anti-harassment policy and share it with employees.
Start with our guide to employee handbook requirements by state.
What Is a Policy and Procedures Manual?
Intended for: Managers/supervisors, the HR team, and/or employees.
Outlines: Detailed descriptions of company policies as well as step-by-step procedures for implementing/carrying those policies out.
Tone: Practical.
Policy and procedures manual contents may include:
- Detailed descriptions of company policies, which may or may not also be summarized or highlighted in the employee handbook.
- Step-by-step instructions for managers/supervisors and/or HR on how to implement company policies, such as how to investigate and address employee complaints/concerns, process employee time off requests, or make payroll corrections.
- Forms, workflows, job aids, etc.
Note that a policy/procedure may live in your employee handbook, policy and procedures manual, another HR-related document, or some combination thereof. There’s no one-size-fits-all answer for how to organize company policies/procedures!
What Is a Code of Conduct?
Intended for: Employees, including managers and leadership. In some cases, it may also apply to contractors, vendors, or others.
Outlines: Expected employee behavior as well as a company’s ethics and values.
Tone: High-level principles/values with supporting expectations and examples.
Code of conduct contents may include:
- Company mission, vision, and values.
- Expected employee behavior, such as treating coworkers with dignity and respect, acting ethically, following company policies and procedures, protecting confidential company information, coming to work ready to do their jobs, accurately representing themselves and the company, using company property appropriately, avoiding or disclosing conflicts of interest, accepting/giving gifts appropriately, and speaking up when they see or hear something concerning.
How These Workplace Documents Fit Together
While there’s some overlap between the documents above, each serves a distinct purpose:
- Employee handbook: Intended for employees; welcoming and accessible in tone; provides a high-level overview of workplace policies/procedures, employee benefits, rights and responsibilities, and other information employees should be aware of.
- Policy and procedures manual: Intended for managers/supervisors, the HR team, and/or employees; practical in tone; provides in-depth descriptions of company policies and step-by-step instructions for carrying them out.
- Code of conduct: Intended for employees and leadership, and sometimes contractors, vendors, or others; sets forth company principles/values as well as expected behavior.
Depending on your industry and locations, there may be additional policies/procedures your organization must follow. Check with your HR professional or employment attorney about applicable requirements.
Finally, keep in mind that acknowledgment requirements vary. It’s good practice to have employees acknowledge receipt of relevant policies/procedures, whether that’s your entire handbook or specific policies. Acknowledgment forms can help document distribution should an employment-related issue arise, but they don’t establish that an employee understood every policy or that the policy is lawful.
What Should Each Document Include?
Your Employee Handbook
Your employee handbook should:
- Be easy to read and understand. Avoid jargon, keep your tone welcoming, and organize your handbook logically with section headings/titles.
- Provide employees with an overview of company policies/procedures. More details can be included in a policy and procedures manual.
- Direct employees to the right resources for policy/procedure questions.
- Include an acknowledgment form for employees to confirm that they received the handbook and know where to go with questions.
Your Policy and Procedures Manual
Your policy and procedures manual should include in-depth descriptions of your organization’s policies/procedures, as well as step-by-step instructions for implementing them.
For example:
- Handbook summary: PTO accrues each pay period.
- Detailed PTO policy/procedures: PTO is tracked in X; PTO requests are submitted to and approved/denied by X; scheduling conflicts are addressed through X; and accrued, unused, or advanced PTO is handled at separation according to applicable law and company policy.
Other topics you might consider including detailed procedures for in your policy and procedures manual:
- Background checks and Form I-9 completion.
- FMLA and any state-specific leave administration, including required notices and applicable forms/certifications.
- Payroll administration, including procedures for pay corrections.
- Complaints: how they’re submitted, received, and investigated.
- Employee discipline/termination: documentation requirements, checklists, etc.
- Employee/company records management: retention requirements and disposal procedures.
- Safety/emergency response procedures.
While larger companies might benefit from having a comprehensive policy and procedures manual, smaller companies might not need a separate, comprehensive manual. That said, if you notice inconsistencies in how policies/procedures are being carried out—for example, two managers respond to the same situation in two different ways—it might be worth writing down your organization’s approach.
Note: Information employees need, such as how to report harassment, shouldn’t be available only in a manual provided to managers/supervisors/HR. The EEOC recommends communicating harassment policies and reporting procedures to employees.
Your Code of Conduct
Your code of conduct should set forth expected employee behavior and might include policies regarding:
- Honest and ethical business practices.
- Respectful behavior in the workplace.
- Conflicts of interest.
- Gifts/entertainment.
- Company assets/equipment.
- Confidential company information.
- Following company policies/procedures and complying with applicable laws.
- How to voice/report concerns, including protection against retaliation for good-faith reports and other legally protected activity.
Depending on the requirements that apply to your organization, you may need a code of conduct. For example, Nasdaq-listed companies generally must adopt a publicly available code of conduct, subject to applicable exceptions, and certain federal contractors have written business ethics and conduct requirements.
Check whether your organization is subject to specific requirements, including any applicable training, acknowledgment, or certification obligations. Annual certification isn’t a universal requirement for every employer.
Other Workplace Documents to Consider
Depending on your organization’s size, industry, and locations, you might also consider the following documents. Check with your HR professional or employment attorney to determine which may be helpful or required:
- Standard operating procedures: For example, how to open/close the store or properly clean/use equipment. Instead of including detailed SOPs in your employee handbook, consider including them in new hire training materials and/or your policy and procedures manual, with references to relevant procedures in your handbook.
- Safety programs: Depending on your industry and locations, you may be required to implement specific safety programs. For example, California generally requires employers to have an Injury and Illness Prevention Program. Summarizing a required safety program in your handbook doesn’t replace requirements to implement the program, train employees, or provide access to it.
- Employment agreements/offer letters: Make sure these are consistent with what you outlined in your employee handbook and won’t create unintended promises or commitments.
- Benefit plan documents: Instead of outlining detailed benefit plan terms in your handbook, consider summarizing benefits and directing employees to the governing plan documents for more information. Explain that the governing plan documents control where appropriate.
One Topic, Different Documents: A Remote Work Example
Depending on the size and scope of your organization, it may make sense to separate some policies/procedures into different documents. For example, a remote work policy might be helpful to separate from your employee handbook if it’s particularly detailed or only certain employees are eligible to work remotely.
Below are examples of how you might discuss remote work in various workplace documents.
Note: These examples illustrate how policies/procedures may differ depending on the document. They aren’t meant to be used as-is!
- Employee handbook: Eligible employees may work remotely up to two days a week with approval. Follow the remote work policy and company data security requirements.
- Remote work policy: Positions deemed remote-eligible may work remotely up to two days a week with approval. Equipment and expense reimbursement are provided in accordance with applicable law and company policy. Contact HR for information on exceptions or accommodation requests.
- Remote work procedure: Employees interested in working remotely should: 1) submit a remote work request via X; 2) discuss their request with their manager, who will coordinate with HR as necessary; and 3) upon approval, work with IT to get set up.
- Code of conduct: Employees are expected to protect confidential company information regardless of whether they’re working in the office or remotely. This expectation does not restrict protected concerted activity or other legally protected employee activity.
Best Practices for Handbooks, Policy Manuals, and Codes of Conduct
Write Your Policies First
Particularly for smaller businesses, drafting your employee handbook can help you determine which policies/procedures you want to explain in more detail in separate documents.
For example, managers may find it helpful to have a separate discipline procedure that outlines how to give written/oral warnings and document concerns.
Name Your Policies Consistently
If you refer to your organization’s PTO policy as “Paid Time Off” in your employee handbook, avoid referring to it as “Personal Leave” in your discipline procedure, unless it’s a separate policy!
Consistently naming policies will help employees and managers navigate and reference them.
Keep State and Local Requirements in Mind
If you have employees in different states, consider outlining state-specific policies/procedures in supplements to your employee handbook.
Start by determining which written policies, notices, and other requirements apply where your employees work. Our employee handbook requirements by state guide can help you get started.
Tailor Your Documents to Your Organization
Your handbook, policies, procedures, and code of conduct should reflect your organization’s size, risks, and needs.
There’s no single employee count that determines whether every business needs these as separate documents. Organizations with only a few employees may benefit from—or be required to have—written policies and procedures beyond an employee handbook.
Think Through Who Needs Access
Employees should have access to employee-facing policies/procedures, such as how to report misconduct or request time off. Managers should have access to procedures they need to follow, such as discipline or performance improvement plan procedures.
Where appropriate, outline employee-facing policies in your handbook and provide more detailed instructions for managers in a separate document.
Don’t Make Promises You Can’t Keep
Avoid promising benefits you won’t provide or mandating steps you won’t follow, particularly around discipline.
Have employment counsel review wording that could create unintended commitments. Adding “generally” or reserving discretion won’t override an employee’s legal rights, applicable agreements, or promised benefits.
Keep Your Documents Consistent
Make sure your handbook, policies, procedures, and code of conduct are consistent with each other and with your organization’s contracts, agreements, and benefit plan documents.
Update Related Processes When Policies Change
When making changes to a policy, particularly where required by law, review related procedures, forms, and system settings to determine whether they need changes too.
For example, if sick leave laws change, you may need to update more than your sick leave policy. Your leave administration procedure, time off request forms, and timekeeping/payroll settings may also need attention.
After making changes:
- Communicate changes to affected employees.
- Train affected employees and managers as appropriate.
- Obtain updated policy acknowledgments where appropriate.
Track Ownership, Versions, and Acknowledgments
Keep track of who’s responsible for each document, effective dates, changes, and prior versions.
If you obtain policy acknowledgments from employees, record which documents and versions they acknowledged receiving.
Acknowledgments help document receipt. They don’t establish that employees understood every policy, and they don’t make an unlawful policy enforceable.
Have Your Documents Reviewed
Have an employment attorney periodically review your handbook, policies, procedures, and code of conduct, particularly language around employee rights, benefits, and discipline.
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Frequently Asked Questions
What’s the Difference Between an Employee Handbook and a Policy Manual?
An employee handbook typically provides a summary of an organization’s policies, expectations, and benefits for employees. A policy and procedures manual may have in-depth information and guidance about company policies and how to implement them.
However, definitions vary, as some organizations call their employee handbook their policy manual. Rather than relying on the document’s title, consider its purpose and intended audience.
Is a Code of Conduct the Same Thing as an Employee Handbook?
A code of conduct lays out expectations for employees’ ethics and behavior in the workplace, such as acting honestly, disclosing conflicts of interest, and showing colleagues respect.
Employee handbooks can contain codes of conduct but generally include additional workplace information, such as benefits, time-off policies, pay practices, and reporting procedures.
Does My Small Business Need a Policy Manual in Addition to an Employee Handbook?
It depends on your organization’s needs. Many small businesses begin by creating an employee handbook and add a policy and procedures manual, or more detailed information within their handbook, as their business and needs grow.
However, depending on your organization, workforce, industry, and other factors, you may need certain written policies and procedures from the get-go. Don’t assume you can wait to put something in writing just because your business is small.
Should My Employees Sign My Policy Manual?
It’s common for employers to ask employees to acknowledge receipt of their handbook. Managers or others responsible for following certain procedures may also acknowledge receipt of a policy and procedures manual or receive training.
If your policy manual outlines rules employees need to follow, let staff know about them and make sure employees can access them. Whether a separate acknowledgment is appropriate depends on the policies, applicable requirements, and your documentation process.
Is an Employee Handbook Considered a Policy?
Employee handbooks typically contain multiple workplace policies and other information employees need to know. Examples include a welcome note from leadership, an anti-harassment policy, the organization’s paid time off policy, and a page for employees to acknowledge receipt of the handbook.
What’s the Difference Between Policies and Standard Operating Procedures (SOPs)?
Policies lay out rules or expectations for employees. SOPs provide guidance, often in step-by-step form, about how to accomplish certain tasks.
For example, your organization’s PTO policy might describe who’s eligible for PTO, how much time employees accrue, and how they can use it. An SOP might outline the steps managers should follow to document and approve PTO requests in your HR system.
What Else Can I Call My Employee Handbook?
Employee manual, staff handbook, company handbook, employee guide, and policy handbook are common alternatives. Some organizations also use “policy manual.”
Whatever you call yours, make sure employees know where to find information about policies that affect them.
(This discussion is for informational purposes only and is not legal advice. Requirements for employee handbooks and policy manuals vary based on an organization’s size, workforce, locations, and applicable laws and agreements.)