Don’t Borrow Another Company’s Handbook!

Many small businesses will ‘borrow’ someone else’s employee handbook in order to save some money.

The problem is that without expert advice, your company could be providing benefits and promises that are not necessary.

For example, FMLA leave is required for businesses that have 50 or more employees within a 75-mile radius. If you have fewer than 50 employees, you need not comply with the FMLA.

UNLESS – your company handbook says so. A 7th Circuit Court ruling illustrates the issue:

According to the federal appellate court, statements in the employee handbook and two letters received by the employee that promised him 12 weeks of FMLA leave may have been sufficient to create an enforceable contract under Indiana law.

Alternatively, the court held that the worker may be able to prove his claim for promissory estoppel because he relied to his detriment on the company’s promises. Peters v. Gilead Sciences, Inc., No. 06-4290, Seventh Circuit Court of Appeals (July 14, 2008).

Courtesy Ogletree Deakins.

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