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Human Resources Policies and Forms: The Backbone of the Firm

By Emily Franchi

#MeToo, Ban the Box, and the Second Chance Act are just a few of the movements and laws that have changed legislation and required employers to update policies and practices. As federal, state and local governments pass new employment laws and update existing laws each year, firms must comply by reviewing employee handbooks and human resources–related forms as well as processes for onboarding, performance management, and termination.

This type of HR housekeeping can often fall to the wayside as firms respond to the demands of clients during busy seasons and the general ebb and flow of business. Unfortunately, it is not until those processes, policies and forms are under scrutiny that the updates occur — which in many cases can be too late.

We are often asked why handbooks, employment applications, and other HR administrative forms are even necessary.

Employee handbooks set the tone of the organization by providing valuable information about the firm as well as stating the firm’s expectations for employees and management. Handbooks should be the “one-stop shop” for employees to gain an understanding of onboarding processes, attendance requirements, dress code, pay practices, leave policies, performance management, and so on. While a carefully constructed and communicated handbook cannot always provide an impenetrable defense against an employment-related claim or lawsuit, it can support the firm’s position, spell out management’s responsibilities, and show the firm’s due diligence in setting clear expectations and boundaries for employee behavior.

Legislative changes can require new policies or simply tweaks in existing policies. If the firm commits to reviewing policies each year, the maintenance required for the handbook can be minimal, and the firm will remain compliant.

While handbook policy updates are important for compliance, it is equally important that firms review all HR-related forms. For instance, employment applications can include liability landmines if not properly and frequently updated. The application might ask questions that can be compliant with employment law one year and noncompliant the next. As an example, many states have recently enacted laws prohibiting questions on an employment application related to salary history. Historically, salary history–related questions were standard, as they gave employers an understanding of whether a candidate would be satisfied with the compensation offered. What happened, however, was that some employers used the candidate’s previous salary to determine the starting salary. This practice contributed to the longstanding issue of gender inequality in pay, as the new pay rate was based more on the previous salary than on the actual position.

A well-crafted employment application will provide information related to skills, abilities, career development, etc., in addition to demonstrating a firm’s commitment to equal employment opportunities. The candidate’s signature on the application acknowledges the accuracy of the information and the at-will condition of employment (if applicable).

Emergency contact forms, benefit applications, leave-of-absence forms, etc., can also fall out of compliance as privacy laws change.

Many employment laws vary not only by the state in which the firm operates, but also by the number of employees in the firm. Considering the annual updates to employment laws, as well as possible growth within each firm, we advise firms to choose a time of year that allows for a comprehensive review of policies, forms and practices. Whether that be after tax season, in the beginning of the new year, or during a slow summer, it’s important that the proper attention be given to ensure compliance with the ever-changing legal landscape.

To help ensure compliance and manage potential risks, CAMICO recommends that the firm reach out to their employment practices risk advisor and/or legal counsel to review all HR-related forms, employee handbook, and performance management practices on an annual basis.

Emily Franchi is Loss Prevention Specialist for Employment Practices with CAMICO. She provides CAMICO firms that have Employment Practices Liability coverage with support on a variety of human resources management issues, focusing on employee relations and legislative compliance for the workplace.

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