How to Draft Employment Policies That Will Strengthen Your Small Business

As a small business owner, you’ve probably noticed that one of your biggest assets is your team. But keeping that team productive, motivated, and aligned with your business goals? That can be a bit of a challenge. One of the most effective ways to build a stronger business foundation is to create clear and comprehensive employment policies. These guidelines aren’t just for big companies—they’re vital for small businesses too. Not only can they help prevent misunderstandings, but they also set the stage for a positive work culture and protect you from legal headaches.

But where do you even start? And won’t having too many policies make things feel overly strict? Here’s the thing: strong employment policies don’t have to be lengthy, complex, or overwhelming. In fact, well-crafted policies are actually a huge benefit, helping you set clear expectations, fostering trust, and saving time in the long run.

Ready to get started? Here’s how to draft employment policies that will strengthen your small business.

1. Identify the Core Policies Your Business Needs

To avoid being overwhelmed, start by identifying the key policies that will have the biggest impact on your day-to-day operations. At a minimum, every small business should have policies around:

1. Anti-Discrimination and Harassment
2. Employee Conduct and Attendance
3. Health and Safety
4. Confidentiality
5. Disciplinary Actions

These areas cover a broad range of potential issues, from interpersonal conflicts to legal compliance. Once you have these basics in place, you can always add more as your business evolves.

Objection: “But I want to keep things casual! I don’t want too many rules.”Response: Remember, policies are not about adding layers of unnecessary rules. They’re about setting a foundation for fairness and mutual respect. They’ll actually free you from having to handle disputes on a case-by-case basis, and help your team understand what’s expected of them.

2. Write Policies in Simple, Clear Language

One of the biggest mistakes small businesses make when drafting policies is using overly complex or legalistic language. Don’t feel like you need to mimic corporate speak—your policies should be straightforward and accessible.

Consider using bullet points or numbered lists to break down information and avoid dense paragraphs. Each policy should be no more than a page long and focus on what employees need to know:

1. What the policy covers
2. How it applies to them
3. Any relevant procedures or consequences

By using simple language, you’ll make it easier for everyone to understand and follow the policies, reducing the chance of misunderstandings.

3. Incorporate Flexibility to Adapt Over Time

Policies should reflect your business values, but they should also be adaptable as your business grows. It’s helpful to frame them as a living document—something that can be updated as you refine your processes and identify new areas of concern.

Include a statement that lets employees know that policies may be reviewed and updated periodically. This way, they’re aware that the policies can change, and it also gives you the flexibility to tweak things as you go.

Objection: “What if changes create confusion?”Response: By clearly stating that policies are subject to updates, you set expectations up front. Regular communication with your team whenever there’s a change will prevent confusion and ensure everyone stays aligned.

4. Align Policies with Your Business Values and Culture

Think of your policies as a reflection of your company culture. Are you a team-oriented business with a focus on collaboration? Make sure your Code of Conduct emphasizes teamwork. Are you in a creative industry where flexibility is valued? Set boundaries, but leave room for innovation and personal expression.

When policies align with your values, they feel more authentic and relevant. This helps you maintain the culture you’ve worked so hard to build, even as your business grows.

5. Seek Input from Your Team

Especially in a small business, getting feedback from your team can be incredibly valuable. When employees feel involved in the process, they’re more likely to buy into the policies and respect them. Plus, your team can provide insights into areas you might not have considered.

When gathering input, keep it simple:

1. Host a casual meeting where you discuss the purpose of the policies.
2. Ask employees if they have any concerns or suggestions.
3. Make it clear that their feedback is valued and will be considered.

This collaborative approach not only improves your policies but also fosters a sense of ownership and respect among your team.

6. Ensure Compliance with Local Laws and Regulations

No matter how small your business is, you’re still subject to local labor laws and regulations. Make sure your policies meet legal requirements, especially regarding employment rights, health and safety standards, and anti-discrimination laws. You may want to consult with an attorney to ensure compliance and avoid legal risks.

Objection: “Isn’t hiring an attorney expensive?”Response: While consulting with an attorney might be an upfront cost, it can save you from expensive legal issues down the road. Think of it as an investment in your business’s long-term success.

7. Communicate Policies Clearly and Regularly

Once your policies are written, don’t just stick them in a drawer or file—make sure they’re accessible to everyone. Share them during the onboarding process, and make sure current employees have access too. A quick, easy way to ensure everyone’s on the same page is to provide a printed copy or upload them to a shared drive.

Regularly remind your team where they can find the policies and periodically review key policies together. This reinforces their importance and keeps them top of mind.

In Conclusion

Drafting employment policies might sound like a daunting task, but it’s one of the best things you can do for your business. Well-crafted policies help set clear expectations, build a strong workplace culture, and protect your business from potential issues. Start by identifying your essential policies, use simple language, and align them with your business values. Remember to communicate them regularly and update as needed.

By investing a little time now, you’ll create a solid foundation that allows you to focus on what you do best: growing your business. Your team will appreciate the clarity, and you’ll gain peace of mind knowing that you’ve set the stage for a safe and productive workplace.

Mitchell C. Beinhaker, Esq. is a business lawyer and estates attorney who runs a solo legal & consulting practice representing business owners, entrepreneurs, executives, and professionals. Through his 30+ years of experience, Mitchell has handled business development, marketing, firm management, along with business transactional work for clients of the firm. He has extensive experience with corporate governance, commercial transactions, real estate, and risk analysis. Using his years of practical experience, he drafts contracts, negotiates purchases, and can manage outside counsel for any corporate situation. For business owners and executives, he creates and implements estate plans, along with succession plans to help companies continue for future generations.  

Mitchell is the co-author of 10 Ways to Get Sued by Anyone & Everyone:  the small business owners guide to staying out of court, available in paperback and kindle from Amazon.

If you are a non-participating provider and need help with your NSA arbitrations, contact our office for a free consultation.  You can email us at info@beinhakerlaw.com.  To learn more about Mitchell and his practice, visit beinhakerlaw.com.