Business dealings these days are based on more than a spoken promise and a handshake. It is important that any business dealings are based on contracts. Moreover, business policies and guidelines are often written in an employee handbook. However, unless a business wants its employee handbook to be considered a binding contract it is important to use the correct language.
Business policies
Most businesses in Baltimore have policies governing workplace behavior and operation. Oftentimes these policies are laid out in an employee handbook. Such policies may include dress codes, whether workers can return products and whether employees can eat or drink on the job.
Business contracts
Business contracts are different from mere policies. Contracts may be oral or written but they exist between a business and the employees. Business contracts with employees may include noncompete agreements, confidentiality agreements and other appropriate actions between employees and employers.
What is the difference between policies and contracts?
Policies and contracts are different in the way they are enforced. If a party to a contract breaches the contract, they could face a lawsuit against the business. On the other hand, a business policy cannot lead to a lawsuit unless the terms of the policies were also included in a contract that was ultimately breached. Thus, businesses should be careful when including promises in its business policies. If not, courts have in the past considered that in such situations an implied contract exists that should be enforced.
Learn more about business law
It is essential that an employee handbook does not contain provisions that can be construed as a business contract. If it does, the employer could face legal action brought by an employee. This post is for educational purposes only and does not contain legal advice. Our firm’s webpage on employment law for employers may be a useful resource for those who want more information on this topic.