Employee handbooks often go overlooked by small businesses, but our survey data from 2,065 U.S. businesses reveals a strong correlation between having an updated handbook and experiencing fast growth. In this article, we will explore the significance of employee handbooks in driving business success and the key reasons why small businesses should prioritize their development.

You can download your copy of our 2023 Small Business HR Benchmark Report at no cost here.

The Survey and Our Findings

A Comprehensive Survey

We gathered responses from 2,065 small businesses, ranging from micro businesses to those with a few hundred employees.

Eight Key Areas

The survey covered eight areas of HR practices, including recruiting, hiring, onboarding, compliance, development, performance management, retention, and post-employment.

Importance of Handbooks

We asked five questions in each of the eight sections to identify the best practices and trends related to HR processes and people management.

Growth Patterns

The final question in the survey focused on business growth, determining whether companies experienced fast growth, were flat, or had a down year.

The Role of Employee Handbooks in Growth

Compliance and Best Practices

Employee handbooks play a crucial role in ensuring compliance with employment laws and regulations. While some businesses may have a compliant handbook, it is essential to incorporate industry best practices and align with the cultural aspects of the organization.

Attracting Candidates

Employee handbooks can be powerful tools during the recruitment process. Sharing the handbook with potential candidates allows them to gain insights into the company’s benefits, culture, and policies, influencing their decision to join the organization.

Enhancing Employee Engagement

A well-crafted handbook answers common questions employees have about leave policies, holidays, paydays, and other important details. By providing clear and consistent information, handbooks save time for both managers and employees and contribute to a more engaged and cohesive workforce.

Driving Professionalism and Cohesion

An employee handbook sets expectations and establishes a professional and cohesive culture within the organization. It serves as a reference guide for employees and managers, ensuring consistent practices and creating a positive work environment.

The Relationship between Handbooks and Business Mindset

Chicken and Egg Scenario

While an employee handbook alone may not guarantee business growth, it reflects a company’s mindset towards establishing and maintaining positive employee relationships. It signifies a proactive approach to recruiting, hiring, onboarding, training, and retaining talent, which ultimately impacts business success.

Holistic Approach

The survey’s findings emphasize the importance of considering all eight categories of HR practices when developing an employee handbook. It is not just about one piece; it is the combination of these practices that contribute to a holistic and effective people management strategy.

A Statistical Advantage

Statistically, companies with updated employee handbooks are one-third more likely to experience growth compared to those without. By prioritizing employee relationships and aligning policies and procedures with modern employment standards, businesses increase their chances of success.


The survey data clearly demonstrates the significance of employee handbooks in driving small business growth. Compliance, culture, communication, and professionalism are all key elements enhanced by a well-developed handbook. Small businesses should recognize the power of this often-overlooked document and prioritize its creation and regular updates to foster a thriving workforce and achieve their growth objectives.

Learn how businesses are outsourcing their HR to Asure to create employee handbooks and more.

Watch our video, Onboarding and Compliance Tips, where we analyze the data from our 2023 HR Survey.

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