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Policy Manuals

May 14, 2003
by Israel Foulon LLP

The case for a policy manual: It causes more good than harm

Some employers are reluctant to embrace the concept of employment policies because they see them as a waste of time and money.

They may also mistakenly perceive the policies as an unnecessary encumbrance, a harness which will inhibit flexibility in the workplace.

Properly drafted employment policies should preserve some flexibility for the employer. But employers should be aware that, in most cases, the very flexibility they seek to preserve may in fact be the cause of many workplace problems. Where management act in an arbitrary and capricious manner, and fail to treat employees consistently and fairly, employers will encounter workplace conflict, low morale, reduced productivity and high turnover.

These and other problems may lead to union drives, unnecessary litigation, human rights complaints and employment standards claims. Good employment policies should reduce or prevent these problems. There are a number of ways in which employment policies can help improve the workplace for both employers and employees.

Promote fairness and consistency

Employment policies provide a framework for management as to how they should supervise employee activities. The policies should help managers in different offices be consistent in how they retain and treat employees. Policies should reduce arbitrary decision-making and discriminatory treatment of employees.

Fair treatment by management will reinforce employee confidence in management decision-making and will also encourage employee support of the policies. An even-handed approach with employees should also reduce workplace conflict and contribute to improved employment relations. Reduced conflict and good employee relations should help reduce the risk of union drives.

Help avoid and reduce the possibility of conflict and litigation

Conflict in the workplace is often the result of misapprehension about what employers and employees expect from the employment relationship. An effective policy manual should clearly set out these expectations, establish the standard of behaviour required of employees and spell out the consequences in the event an employee fails to meet this standard.

The potential for conflict is diminished where parties are aware of their obligations and know how they are expected to perform in the workplace.

Policies may reduce the length and cost of litigation. Depending upon the policy manual and how it has been applied, a court may find it forms part of the contractual terms which govern the employment relationship.

Where it is clear the policy manual is enforceable, and that one party has breached its obligations under the policy manual, it is less likely that the matter will proceed to a trial as the uncertainty of the parties with respect of employment obligations has been eliminated.

Effective communication tool

A policy manual is a vehicle for communicating information to employees. Policies can be used to inform employees about the organization, about the terms of the employment relationship and about the variety of benefits and incentives available to employees.

Policies can also inform employees how they can access these benefits. When this information is covered in a policy manual, employees with questions can refer first to the manual. The policy manual should reduce the amount of time management spend dealing with these questions.

Create a team atmosphere

A policy manual provides management with a unified sense of purpose. It also helps demonstrate to management that the organization will provide them with the support necessary to do a good job. For employees it indicates the employer’s willingness to commit time and resources into creating a fair workplace. When developing and revising the policy manual, employers should consult with employees and management. Involving management and employees in the process contributes to an atmosphere of inclusion, improves morale and maximizes the development of appropriate and relevant content.

Peter Israel is the senior partner in the Toronto law firm of Israel Foulon LLP – Employment and Labour Lawyers. He can be reached at 416-640-1550 or pi@qtw38575.mywhc.ca. A version of this article originally appeared in the Carswell publication, Canadian Employment Law Today.


Legal Disclaimer

This article is for informational purposes only and is not intended to provide legal advice, which in all circumstances must be tailored to the specific facts of any problem. You should obtain a proper legal consultation in order to determine how this article applies to your specific situation. Please feel free to contact Israel Foulon LLP to learn more at 416-640-1550.