Manage Risks and Standardize Practices with Workplace Policies

Workplace policies dictate corporate life. Companies’ legal claims and defense often succeed or fail on the question of whether a workplace policy exists, be that policy positive or negative, written or unwritten.

What is a corporate policy? In short, a corporate policy is a practice followed by a company. And, because companies can only act through their employees, policies are most often reflected in how employees conduct themselves. Policies are internal contracts between employer and employee.

Can a policy exist if it is not written down? This is a question with real-world legal and risk management importance. For example, often the ways that products are loaded and secured for transportation is not pursuant to a detailed written policy, but still done the same way, each and every time. Does that mean a policy exists? And, if an injury or accident occurs, what sort of defense does an unwritten policy provide to a legal claim?

Uniform, unwritten practices can be useful and often have the effect of policy. In 2010, the Equal Employment and Opportunities Commission sued Con-Way Express on behalf of a rejected job applicant claiming that Con-Way’s hiring decisions were racially motivated. Con-Way defended the case by arguing that it was simply complying with its unwritten policy of not hiring applicants with theft convictions. Con-Way eventually won, but needed to present evidence of its hiring practices, as well as the criminal records of its current employees, in order to support its position.

Potential points of opposition:

• The information contained in the mark is redundant, since it is already available through the listing agency.
• Additionally, most consumers do not like to have permanent marks on their windows or glass doors.

While useful, risk comes with unwritten policies. For example, Con-Way’s entire defense could have withered if one of its managers did not follow the unwritten policy. In addition, the expenses and intrusiveness of having to prove years of hiring practices and validate personnel records could have been avoided by simply formalizing the policy.

And not all such unwritten policies are favorable. There are many stories of government actions and litigation against companies based on consistent enforcement of unwritten, improperly biased, hiring criteria.

Why don’t companies enact policies, even to spell out crucial things like job qualifications? The answers vary. Some feel they are too small to have a policy handbook. Others believe policy development is too difficult to write. Institutional momentum against policies also exists—“we’ve never had one and don’t need one.” And while not improper, these positions also require accepting the risks that come with a lack of written policies.

When companies commit to developing written policies, their approach can have a dramatic impact on the usefulness of those policies. Overdevelopment—too many policies for discrete items—can often lead to paralysis and an inability to effectively update and keep policies current. Underdevelopment—policies that are too few or too general—often leads to policies being ignored.

Positive policy development starts with identifying points where a company should speak or act in a unified way. Good policies help establish a consistent position on items that might otherwise be left to the discretion of managers.

A commitment to develop workplace policies requires observing operations and auditing processes to identify points where discretion has led to differing work practices. For glaziers, shipping, personal protective equipment and on-job behavior are often areas where differences in crews can lead to different client experiences. Examine these functions for points where a set of common practices, supported by policy and training, can help more effectively manage personnel and present customers with a more uniform encounter.

Enforcement and training are two areas where companies with developed policies must remain vigilant. A poorly worded policy may be better than no policy, but a policy that is unenforced may be worse than no policy in the first place.

A policy tries to set a standard. When those standards are not met, a company can be subject to contest or legal claim. Repeated training on company policies, and reasonable consequences for non-compliance, are essential components of an effective policy plan.

The most important item is consistency. Policies are a company’s voice, and can help determine customer experience. Establishing compliance with proper unwritten policies or documented compliance with formalized policies is an important risk management consideration.