HR Policies You Should Avoid Putting in Your Employee Handbook

Employee handbooks are essential for setting expectations, communicating company values, and ensuring compliance with employment laws. A well-crafted handbook acts as both a guide and a shield for your business.

But here’s the catch: what you leave out of your handbook is just as important as what you put in. Including the wrong policies—or phrasing them poorly—can create unnecessary legal risks, restrict your flexibility as an employer, and even confuse or alienate employees.

Here’s a list of HR policies and practices you should avoid (or handle very carefully) when creating or updating your employee handbook:

It’s tempting to outline a step-by-step disciplinary process, such as issuing a verbal warning, then a written warning, then suspension, and finally termination. You might think you’re being clear and fair—and you are—but spelling it out too rigidly can backfire.

If you don't follow those steps exactly in every situation, an employee could claim wrongful termination or discrimination. Even if the situation clearly warranted a different approach, failing to stick to the outlined process can become a legal headache.

Better approach:
Instead of hard promises, use flexible language. Say things like, “Disciplinary actions may include verbal or written warnings, suspension, or termination, depending on the circumstances.” Always reserve the right to act at your discretion.

Phrases like "permanent employment," "guaranteed employment," or "long-term career" might sound positive, but they can inadvertently create an implied contract. If someone is later terminated, they might argue they were promised permanent employment and sue for breach of contract.

Better approach:
Always include a clear at-will employment disclaimer in your handbook. Let employees know that either they or the company can terminate the employment relationship at any time, with or without cause or notice.

Laws—and cultural expectations—change faster than ever. If your handbook bans tattoos, mandates gender-specific dress codes, or enforces blanket non-compete agreements (especially in states where those are illegal or restricted), you could face backlash or even legal action.

Better approach:
Regularly review and update your handbook. Avoid including policies that are discriminatory, overly restrictive, or no longer compliant with modern employment law.

Handbooks are meant to share policies, not procedures. Detailed instructions for using software, completing performance reviews, or onboarding new hires might seem helpful—but as soon as those processes change, your handbook is outdated. Worse, employees could claim unfair treatment if you don’t follow the exact written process.

Better approach:
Keep operational details in a separate internal guide or SOP (Standard Operating Procedure) document. Your handbook should focus on broad company policies and expectations.

Language suggesting that employees will definitely receive pay increases or bonuses can be dangerous. If you promise an annual raise or performance bonus and then, due to budget cuts or other factors, you can't deliver, you open the door to legal claims.

Better approach:
Use wording like, “Employees may be considered for salary adjustments and bonuses based on individual performance, business needs, and other factors.” Keep flexibility on your side.

Including the full text of laws or using dense legal terminology might seem like a way to cover your bases. In reality, it can overwhelm and confuse employees, making them less likely to read—and understand—your handbook.

Better approach:
Use plain, accessible language whenever possible. If you must include legal policies (like FMLA rights or anti-harassment laws), provide a simple summary alongside the required legal language.

A poorly worded or outdated policy can easily cross the line into illegality. For example, mishandling overtime eligibility, misclassifying employees, or failing to properly explain leave entitlements could put you at risk for lawsuits or Department of Labor investigations.

Better approach:
Get your handbook reviewed by an employment law attorney familiar with your state’s regulations. A few hours of legal review can save you enormous costs and trouble down the road.

While hustle culture might push ideas like "always be available" or "respond to messages within minutes," requiring employees to be constantly connected could violate labor laws—particularly for non-exempt employees entitled to overtime pay.

Better approach:
Clearly define work hours and on-call expectations. Set healthy boundaries for communication outside of work hours, and compensate employees accordingly if extra availability is needed.

It's natural to want employees to speak positively about your company. However, broad non-disparagement clauses (especially those banning discussions about wages, hours, or working conditions) may violate the National Labor Relations Act (NLRA). Employees have the right to discuss these topics—even if it’s not always flattering.

Better approach:
Encourage a positive culture and respectful communication, but avoid trying to silence lawful employee discussions. Focus any confidentiality policies on protecting legitimate trade secrets and sensitive company information.

An employee handbook is one of the most important documents a business can create—but it’s also one of the easiest to get wrong if you’re not careful.

Remember: the goal of your handbook is to set clear expectations, protect your business legally, and foster a fair, transparent workplace. It’s not to create rigid promises or overwhelming rules that tie your hands.

By avoiding these common pitfalls, you can create a handbook that protects your business, empowers your employees, and leaves room for growth and flexibility as your company evolves.

Pro Tip:
Review your handbook at least once a year, and anytime a major employment law change occurs. And don’t hesitate to get a professional review—saving a few dollars now could cost you much more later if something goes wrong.