How to Create an Employee Handbook

Employee handbook or instruction manual is one of the essential tools for businesses to address and communicate with their workers. It is important that the handbook is put together concisely but is comprehensive in terms of all important regulations an employee is expected to follow.


  • 1

    Make a rough draft of the policies and procedures

    Outline all the procedural guidelines roughly in order of preference or importance.

    Start with a brief overview of the company - mission statement etc.

    Insert company procedures or general policies – salaries, reporting hierarchy, working shifts, Dress code, selection process, and training etc.

    Dos and Don’t  - General information regarding business ethics, which covers extensive subjects such as equality, disability, drug and alcohol abuse, violence and behavioral problems  etc. Most companies will have a uniform way of addressing all such issues before going onto explain business related procedures.

    Benefits – Medical insurance, saving and investment plans, bonuses, vacations, compensation, over-time benefits, disability benefits, promotions and discounts.

    Terms of Employment – Termination policy, confidentiality report etc

  • 2


    Distribute the rough draft to the employees and senior staff such as managers and supervisors for feedback. Recheck for any errors or ambiguities, and review the feedback in order to make the necessary amendments. Carry the exercise from department to department for greater precision.

  • 3

    Hire a professional team

    Recruit legal professionals who will go through the rough draft and check for any inconsistencies. Most large companies will require a team of legal or human resource professionals who will ensure that all necessary issues have been covered in the handbook. For small business, this work will be carried by a lone HR or legal person.

  • 4

    Distribute the handbook to the employees

    Having formalized all the details, now make copies of the handbook before distributing it among all your employees. Make sure that all workers read, and understand the procedures and guidelines, before asking them to sign it. Include a tear out page so that employee returns it back to you stating that they have understood all the terms and conditions. It will be a proof in case of any ambiguity.

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