Common Employee Handbook Pitfalls for Utah Employers

 

We often review employee handbooks that contain head-scratching provisions while reviewing handbooks for updates, during the course of litigation, or in the context of advising employees on their rights and obligations. Over the past twenty-five years litigating employment cases, we've seen virtually every type of handbook provision that you could imagine. During that time, we've noticed a number of common areas where employers make mistakes that can often lead to heavy liability. Here are a few examples.

1. Including Restrictive Covenants in Employee Handbooks.

We have seen numerous employees attempt to include various restrictive covenants in handbooks, including noncompete clauses, non-solicitation clauses and non-circumvention clauses. Avoid this at all costs. First, most of these provisions are unenforceable because other sections of the handbook expressly disclaim that the handbook creates and independent contractual agreement between the employer and employee. Second, even if the handbook is carefully drafted to create a contractual commitment, having a noncompete agreement that purports to apply to all types of employees regardless of their duties, access to information, or creation of good will for an employer is likely to create significant enforcement issues. Additionally, an employee most likely can argue that the agreement was procured in bad faith rendering the provision void under Utah case law. 

2. Including Nondisclosure Agreements in Employee Handbooks.

While not necessarily as problematic, the same limitations exist for nondisclosure agreements contained in handbooks as those for other restrictive covenants. A better practice for these types of agreements are to ensure that restrictive covenants and nondisclosure agreements are tailored to comply with applicable state law (like Utah's Post-Employment Restrictions Act) and set forth in a separate agreement signed by the employee. While general provisions emphasizing the need to only use information for purposes of performing an employee's job duties and discussing obligations about the need to keep information private and confidential (i.e., patient information) are important, obligations for employees to not improperly use or disclose information should be included in a separate nondisclosure agreement.

3. Including Unlawful Restrictions on Employee Collective Activity in Employee Handbooks.

Policies that prohibit employees from discussing wages, supervisors, or working conditions — even online— can violate the National Labor Relations Act and other laws. Similarly, policies that prohibit employees from disparaging their employer also are problematic if not appropriately limited. While it's okay to have policies that emphasize protecting confidential information they need to be tailored to limited bans on lawful concerted activity. While this area of law is always developing and changes often based upon political appointments, it's still an area of significant concern and liability.

4. Including Zero-Tolerance Drug or Alcohol Policies that Fail to Account for Lawfully Prescribed Medications used by Employees in Employee Handbooks.

Policies that automatically terminate any employee who tests positive for drugs can run afoul of the ADA or state laws. Many employees take legally prescribed medications as a form of accommodation that do not impact or impair their abilities to perform duties, but that could cause a positive test result. This is not to say that you need to tolerate illegal, illicit or other drugs, or that prescribed medications will not impair individuals at work. But you need to be more cautious with how you deal with those situations and evaluate these issues on a case-by-case basis.

Of course, a good handbook is specifically crafted to deal with the types of issues you deal with. If you have questions about handbooks, or need a skilled lawyer to review your handbook, or if you are an employee with questions about a handbook that your employer has issued, we are happy to answer any questions you may have. Call one of our Utah employment lawyers at Stavros Law P.C. at (801) 758-7604 or email us at scheduling@stavroslaw.com for additional information, or to set up a consultation.

Location: Utah, USA

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