4 Reasons Why Employee Policies Are Like Prenups

Prenup, just the word sounds distinctly unromantic.  But many experts say that it makes sense for each half of a couple to take steps to protect themselves and to avoid heartache and conflict later.  Now, if something wonderfully romantic like marriage and promising yourself to another for the rest of your life (hopefully) needs a proper "out" plan, don't you think something  entirely unromantic like your employee hiring process should have one?

There are few things more important to a business that proper HR procedures and documentation.  A well-written handbook and New Hire Packet clues everyone in on day one.  They lay out expectations.  They address how to handle issues before they arise. And like a good prenup, they tackle how you'll unwind everything should the relationship end.

Here are 4 items to tackle before taking the plunge with a new team member:

Get to know the person better.

Much like a person with bad credit generally doesn't like to admit or discuss it, an employee with bad habits isn't going to divulge them in the interview.  "Yes, I will likely show up late on a regular basis and have a tendency to use profane language with customers."  Addressing important expectations, even ones you consider common sense or obvious, is important.  If it's important to your business, it should be in writing. 

Have you checked references?  Do you do back-ground checks?  These two practices can help you dodge some "lousy employee" bullets.

What happens to the money?

So Joe employee has been terminated.  When do they get their last pay check?  Where?   Are final commissions held for a time period?  Make sure you check state labor law guidelines for compliance. 

It's much easier to lay this all out in your pay procedures then wait until an angry ex-employee is demanding their check.  Reference your procedure and point it out on their pay policy acknowledgement form.

What happens to company property?

Planning to issue a company card, phone, computer, etc?  Well then you need to address how you'll get it back.  Any issued property should have an acknowledgement of receipt which addresses value and return procedures-- and consequences when property isn't returned.  Again, be sure to check state labor law guidelines to ensure your procedure is compliant.  Some states don't allow for the holding of payment until property is returned or a payroll deduction. 

Alimony?

Well, not alimony, but ongoing compensation in the form of unemployment or severance.  What situations merit an unemployment claim to be contested?  Which don't?  Is this employee being offered severance?  If so, what is the company getting in exchange for it?  A proper severance agreement can ensure your ex-employee rides happily--or at least legally-- off into the sunset without looking back.   More importantly, it may prevent them from disparaging you in the market place and online or bringing a suit against you.  Like alimony,  severance is generally reserved for employees with tenure who, at least at one time, were in your good graces.  It is meant to ease the pain of unemployment until an employee is able to get back on their financial feet.

Abandoning a bad relationship.

Your policies address how you will deal with issues.  Generally businesses employ a progressive system wherein:  a problem is addressed, a solution is discussed, and time is give to rectify the issue.  This system is followed in progressively more serious tones until a limit is hit.  At some point, you reach a deal breaker.  Spell out your deal breakers.  What can't you work through (one strike you're out) and what would allow for a few counseling sessions (three strikes you're out).  Figure this out ahead of time and follow it uniformly with all team members.

Finally, like any good relationship, the employee/employer relationship requires respectful and timely communication.  Much like a couple doesn't wake up and think, "let's get a divorce" all too often employers allow termination decisions to fester over time.  Unfortunately during that time, people end up making bad decisions in reaction to a problem(s) which hasn't been addressed.  Adopt a policy of clear action and discussion as issues arise and save yourself an ugly breakup later.