The difference between policies and procedures, what a small business manual should contain, a step-by-step writing process, a format that people actually use and how to keep the manual current.
The two are related but different. A policy states a rule or principle and why it exists: “Employees must record all time worked; off-the-clock work is not allowed.” A procedure explains how to carry it out: “Clock in on the app when you arrive at your station. If you forget, submit a missed punch request the same day.” Policies change rarely; procedures change whenever tools or processes change.
Many small businesses keep both in one manual, with each policy followed by its procedures. Larger organizations often separate an employee handbook, which focuses on employment policies, from operating procedures and SOPs for specific tasks.
Manual checklist complete.
| Section | Examples |
|---|---|
| Introduction | Purpose of the manual, how to use it, who to ask, mission and values |
| Employment | Equal opportunity and anti-harassment, hiring, classifications, at-will statement where applicable |
| Time and pay | Work hours, timekeeping, breaks, overtime approval, pay periods, payroll corrections |
| Attendance and leave | Attendance and lateness, call-outs, time off requests, sick leave, holidays, FMLA where applicable |
| Conduct | Code of conduct, dress code, phone use, social media, confidentiality, conflicts of interest |
| Safety | General safety rules, PPE, incident reporting, emergency procedures, workplace violence |
| Operations | Opening and closing, cash handling, inventory, customer service standards, quality checks |
| Technology and data | Computer and app use, passwords, data privacy, customer information |
| Discipline and separation | Progressive discipline, investigations, resignation, final pay |
| Acknowledgment | Signed confirmation that the employee received and read the manual |
Many owners assume a manual must include certain benefits because the law requires them. The FLSA actually does not require vacation, holiday, severance or sick pay, meal or rest periods, premium pay for weekend or holiday work, or a discharge notice, although some states have laws on some of these (DOL elaws FLSA advisor).
That cuts both ways. You have freedom to design these policies, but once you write a policy down, you are expected to follow it consistently. Before adding a benefit to the manual, check your state’s rules, decide exactly who qualifies and write the conditions clearly, so that an exception for one employee does not become a precedent for all.
Purpose: To make sure all time worked is recorded and paid accurately.
Scope: All non-exempt employees.
Policy: Employees must clock in and out for every shift and meal break. If a punch is missed, the employee must submit a correction the same day or at the start of their next shift. Time worked will always be paid; repeated missed punches may lead to coaching under the attendance policy.
Procedure: 1. Open the time clock app. 2. Select the shift. 3. Submit a missed punch request with the correct time and a short reason. 4. Your manager approves or follows up within two business days.
Contact: Your shift manager or payroll.
Effective: [date]
See our missed punch form for the paper version.
Give one person clear ownership, usually the owner, operations manager or HR lead. They keep the master copy, track review dates, collect suggestions from managers and make sure changes are communicated. Managers should be able to propose updates when a procedure no longer matches how work is done, but only the owner publishes changes. This avoids several versions circulating on different shifts and locations.
A manual that is out of date is worse than none, because it gives the wrong answer with authority. Assign an owner, review the whole manual at least once a year and update specific policies when laws, tools or processes change. Record the version and effective date on each policy, tell employees what changed and collect new acknowledgments for significant changes. Keep old versions on file; you may need to show what policy applied at a particular time.
EZTime’s digital HR forms and e-signatures let you send policies to employees’ phones and collect signed acknowledgments, stored in each employee’s digital file. Announcements with read confirmations let you tell the team when a policy changes and see who has read it.
A policy states a rule and its purpose, such as requiring all work time to be recorded. A procedure gives the step-by-step instructions for following it, such as how to correct a missed punch.
Employment and anti-harassment policies, time and pay, attendance and leave, conduct, safety, operations, technology and data, discipline and separation, plus an acknowledgment form.
No general law requires one, but some specific policies or notices are required by federal, state or local law, and written policies help show what employees were told.
Review it at least once a year and update policies whenever laws, tools or processes change. Record version dates and tell employees about changes.
Yes. A signed acknowledgment that the employee received and read the manual is standard practice and helpful if a policy is later disputed.
Not quite. An employee handbook is written for employees and covers the policies that affect them: pay, time off, conduct and benefits. A policy and procedure manual is usually broader and more detailed, covering how the business operates, including procedures employees may never need to read.
There is usually no legal requirement, but a signed or electronic acknowledgment is strong evidence that an employee received the policy. Ask for one at hire and whenever a major policy changes.
EZTime lets you share policies through the company feed with read confirmations, so you know who has seen each update.