Tightrope: Employment manual is a necessity, not a formality

— -- Hi, Gladys, For the past five years I have owned an exercise studio that I consider to be successful, and I make a good living from the business. However, I sometimes fall short in handling employee situations. I usually don't address issues related to vacation, time off or workman's comp until something happens to bring it up. My wife says that this is not the way to run a business and that I should have a written employee policy manual. That seems like a lot of formality that I don't think a small company like mine needs. What do you think? —Marty

All too often someone will start a business and think that because it's a small operation it doesn't need to operate as a structured business. Nothing could be further from the truth. And, if you are hiring people to work for you, both you and your employees will need something written to keep you both on the right track.

You said, "It seems like a lot of formality." Perhaps it will become more palatable to you if you change how you see a written polices manual. Instead of thinking of it as a formal intrusion, think of it as a way of expressing your visions and goals for your operation to your employees. Also think of it as a tool that helps to keep you on track to realize your visions and goals.

You can find books and templates to guide you in developing an employment policies manual. Here are a few things that come to mind that will get you off to a good start.

Terminating an employee can be a tough situation and it is important to know what the law has to say about this.

Most employment in the United States is considered "at-will." This means that either party is free to end the employment with or without notice, as long as there are no binding contracts. Double check this with a lawyer and make sure that you and your staff fall under the "at-will" rule.

Workers compensation and unemployment benefits should be written out in detail so that you are both clear on the pros and cons of both.

Last fall an entrepreneur called me to see how she could go about suing a former employee to prohibit her from getting unemployment. During our conversation I discovered that the woman had eliminated several positions due to decrease in business. She got upset with me when I told her that her former employee was entitled to unemployment comp.

In another case, I recall several years ago working with an entrepreneur who had a couple of employees who were working full time for this entrepreneur and collecting unemployment at the same time. When I questioned the entrepreneur about this he seemed clueless as to how his employees could also be collecting from his unemployment compensation plan. When I questioned the employees, they said that several friends had told them this was done all of the time. It appeared that both the entrepreneur and his employees were unaware of the proper procedures.

Do me a favor and please put something in your policies manual about cellphone use during working hours. That seems to be something that many businesses are overlooking.

Recently a friend invited me to her gym for a yoga class. The class was proving to a welcome, relaxing relief after a hectic day. But just as the instructor had us to move into a shoulder stand, her cellphone rang. There we were, left with our toes pointing to the ceiling as we balanced our weight on our necks and shoulders while she answered her cell.

Listen to your wife. Develop an employee manual. It could make your life easier and make your business even more successful.

Gladys Edmunds' Entrepreneurial Tightrope column appears Wednesdays. Click here for an index of her columns. As a single, teen-age mom, Gladys made money doing laundry, cooking dinners for taxi drivers and selling fire extinguishers and Bibles door-to-door. Today, Edmunds is founder of Edmunds Travel Consultants in Pittsburgh and author of There's No Business Like Your Own Business, a six-step guide to success published by Viking. Her website is www.gladysedmunds.com. You can e-mail her at gladys@gladysedmunds.com.