Although no state or federal law requires an employer to have an employee handbook, there are many policies and procedures the law does require employers to communicate to employees. Many employers use an employee handbook to describe the employer’s history, mission, values, policies, procedures, and employee benefits. A well-written employee handbook also answers many routine questions employees may have and avoids using additional time and resources of employees, the human resources (HR) department, or managers in answering those questions.

Employers often require each employee to sign a written acknowledgment of receiving the employee handbook—but must be careful not to have the handbook construed as an employment agreement, which might change the employee’s status from an at-will employee who can be fired or terminated at will to an employee who can only be fired or terminated for cause.

Employers must also be careful to avoid overly broad statements in the employee handbook that restrict the ability of employees to discuss wages and other terms and conditions of employment—including criticisms of the employer—which are known as protected, concerted activities.

In Alabama, while there is no specific state or federal law mandating the creation of an employee handbook, it is a common practice for employers to use handbooks to communicate important policies and procedures to their employees. These handbooks typically cover the company's history, mission, values, policies, procedures, and details about employee benefits. They serve to answer common questions, saving time for HR and management. When distributing handbooks, Alabama employers often ask employees to acknowledge receipt, but they must be cautious not to imply an employment contract, which could alter the at-will employment relationship. Alabama follows the federal at-will employment doctrine, meaning employees can generally be terminated at any time without cause, unless there is a contract stating otherwise. Additionally, employers must be careful not to include language in the handbook that could be interpreted as restricting employees from engaging in protected, concerted activities, such as discussing wages or other employment terms, which are protected under the National Labor Relations Act (NLRA).