European Companies Must Maintain a Handbook for Employees of their US Subsidiaries


European Companies Must Maintain a Handbook for Employees of their US Subsidiaries

DSML Executive Search is a specialist in helping European and Canadian owned firms recruit and hire C-suite leaders for their US Subsidiaries.  Our experience in recruiting for foreign companies doing business in the United States is that many of our clients have not created an Employee Handbook for their business.

Contrary to European practices, where an employee contract is completed for everyone hired and statutory rights exist that cover all employees, the United States operates differently.

Whereas, in the United States, an employee agreement may be in place that creates the legal rights and obligations of an employer and employee, an Employee Handbook lists the various policies and procedures that apply to ALL employees.  An employee agreement cannot be changed without the employee’s consent; however, an Employee Handbook can be updated with changes without the consent of the employee.

An Employee Handbook normally covers the following topics:

  • A welcome statement, which may include historical and cultural information regarding the company
  • Procedures relating to government withholding forms, requirements for eligibility of employment, etc.
  • Distinction between full and part-time employment and related benefits such as vacation, PTO, insurance, 401K, guidelines for travel and expenses
  • Expectations relating to conduct, (harassment, drug & alcohol use, attendance, etc.) reasons and procedure for dismissal, communication regarding work-related issues
  • Guidelines for performance reviews and policies for promotion/demotion
  • Policies concerning mail, use of company equipment, Internet, email, social media, automobiles for work related use
  • Procedures regarding work related injuries
  • Employee procedures for retirement, resignation
  • Requirement, (referencing non-disclosure/non-compete agreements if in place) that employees keep business information confidential
  • Information related to the release of employee records, as well as who may request and inspect specific information

Laws and regulations frequently change both at the state and federal level.  It is recommended that companies update and distribute their employee handbook on an annual basis.

Social Media, as mentioned in a bullet point above, deserves special attention as digital platforms and social norms change very quickly.  A policy relating to Social Media may contain several components … using personal social media accounts while at work, the personal use of company equipment (computer, mobile phone, etc.) and, representing the employer through social media.

Employees, of course, own their social media profiles and what they post cannot be restricted by an employer.  However, reasonable guidelines should be established regarding what employees should not share on social media, (confidential or client related information, for e.g.) and penalties should be established should an employee damage the employer’s reputation through a social media post.  (By saying “social media” we are referring to online communities like blogs, chat rooms, social networks, group texts, forums, etc. and not simply platforms like Twitter, Instagram and Facebook.)

Employees are often requested to sign an acknowledgement form stating that they have received and reviewed the information within the employee handbook. An acknowledgement form would typically include additional content, such as a disclaimer that the Handbook is not a contract, that the handbook may change over time, (with or without notice), and that employment is at-will.

It is recommended that employee handbooks be reviewed by an attorney for consistency and compliance with federal and state laws.  The growing number of employee-related litigation against management suggests that an employee handbook regarding company policy is a business necessity.

For more information on other recruitment related articles please visit the DSML Blog.  Please also follow-us on LinkedIn, where our blog posts are also published.

If your company is seeking to recruit for a key position, such as CEO, COO, President, VP or other Senior level role, have a conversation with DSML Executive Search to ensure your search includes a “thorough” process and a “success based” strategy.