HR policies: 10 best practices for creating effective policies

HR policies are some of the most important and most read policies within any organisation. How you create and then manage HR policies matters.

Every business has HR policies that all employees need to read and access.  Having the right HR policies supports compliance, maintains professional standards, minimises risk for both the business and individual employees, and even helps to define your employee value proposition.  With HR policies, the devil really is in the detail, so they need to be written, reviewed and managed with great care.

Sarah May is a UK-based independent HR Consultant and workplace mediator, and founder of consultancy Mayday HR. Sarah is an expert in the HR policy space and has also helped us here at Content Formula (the producers of Xoralia) create our own HR policies.

We asked Sarah for some of her tips and views on the best practices for creating and managing HR policies.

Make HR policies understandable and digestible

Xoralia is a comprehensive policy management solution that is built for Microsoft 365 including SharePoint and Teams, which focuses on a strong user experience for employees, policy owners, and admins.

“The trick to writing HR policies is that they have to be something that people will read and understand,”

advises May.

“If you write policies that are long winded and full of legal jargon, they’ll just never be read. You need to use plain language.”

Ensure HR policies are relevant for your organisation

Many HR teams choose to purchase an HR policy template to use. While this gives businesses a starting point to finalising a policy, it is important to then customise the policy, so it makes sense for your organisation and rings true for employees.

“Policies should reflect your organisational tone of voice and be relevant. If you buy policies off the shelf and they don’t make sense for your business, then people will then ignore it”

warns May.

“I was once reviewing an employee handbook, and it was for a fully remote business, and they had a page and a half on smoking! If one thing isn’t relevant, the employee may think none of this is relevant and will ignore the policy.”

Policies must mirror the legislative landscape

HR policies help to ensure business and their employees remain compliant with the law. But the HR legislative landscape is complex and ever changing - and that’s true for most countries in the world. Wherever you are operating, May warns HR policies must always keep in step with the law.

“For example, here in the UK there is the ACAS code of practice around disciplinary and grievance policies, and any related policy should mirror this. Same for things like bullying, harassment, and equal opportunities. So, when I write policies these days for a UK company, I normally add in a link to the ACAS guidance.”

A policy needs purpose, process and guidance

A question we often get asked at Xoralia is which elements should be included in an HR policy. When asked for her views on what to include, May stresses that different HR policies can include different elements but also mentions a number of common areas.

“In terms of format, a policy should have a general overview, which would cover the purpose of the policy - the what and the why. I think it also needs to have details of any processes involved in policy. Sometimes you may want to have a flow chart - it doesn’t all have to be written. And you may also have guidance - for example manager guidance on using the policy.”

Use examples to make your HR policy tangible

HR policies need to be crystal clear and avoid ambiguity. May suggests including real world examples to help illustrate an HR policy, supporting better understanding by making the policy less theoretical and more tangible.

“In a bully and harassment policy, you’d want examples of what harassment is and what isn’t acceptable. In a whistleblowing policy, you'd have examples of what constitutes whistleblowing. I think examples are really helpful.”

Outline employee and employer responsibilities

An HR policy should not be a document solely about the duties of the employer or just about the rules for an employee to follow. It should really cover both bases.

“Policies are two-way,”

explains May.

“They are there for the employer to set out to the employee saying, ‘here's what you can expect from us,’ but it is also there for the employer to say, ‘this is what we expect from you’. It goes both ways so it’s always helpful to outline employee responsibilities and employer responsibilities relating to a particular area.”

Make escalation points clear

HR policies can involve sensitive areas and cover a process such as reporting a grievance, where an employee may need to raise an issue in confidence. In these cases, May stresses the importance of the policy detailing the escalation point if somebody does need to raise a concern.

May comments “It's always helpful to add in where your escalation point is. So, if you have a grievance against your manager, how do you escalate that? I’ve dealt with cases where one of the key issues is that there is no proper process for when someone wants to complain about the boss.”

May also explains that in some very small businesses, escalation can be difficult with everyone so close to each other, which can deter issues being reported. Sometimes it can help to have an external third party to report a grievance to, and May herself is the escalation contact for some of her smaller clients.

Always include a review date

Keeping HR policies up to date is essential so they need to be regularly reviewed. May comments

“You should always include a review date on a policy. I'd recommend that policies are reviewed at least annually. At the review, ask has anything changed? Is this policy still fit for purpose? Do we need to do it differently? Have we had problems in the past year from this policy, and do we need to tweak it?”

Equally important is having a clear review process, including who is responsible for making the change and if anyone needs to approve the changes. Having an annual review process does not mean that a policy can only be reviewed or updated at that time; May advises HR teams to keep an eye on any legislative changes that will trigger a need to review a policy at any time.

“You might not need to change your whole policy, but you need to update it. You always have to follow the law.”

Get stakeholder input where necessary

Naturally HR policies are principally going to be defined and articulated by the HR team. But sometimes it can be important to make sure you involve other business stakeholders in giving input or being part of the review process. May mentions “Working from home” policies as an example of an HR policy that usually requires wider input.

“When you review a work from home policy, you don’t just check whether it is legally compliant. You would go, are we still happy with what we're offering our people? Is this flexible enough? Are we giving them too much flexibility? Have we had issues? For some areas, it’s really important to get stakeholder buy in outside of the HR team.”

This may mean that stakeholders need to be formally involved in the policy review process.

“You might want to add someone outside of HR that also reviews a policy, because HR policies always need buy in from other stakeholders.”

Be careful when using generative AI

Generative AI can create documents in seconds that seem very credible. However, you need to be very careful if you are using ChatGPT and other similar AI engines to generate HR policies which may contain errors and leave critical elements out.

“I'm seeing a lot of businesses these days writing their own HR policies and getting ChatGPT to do it” observes May. “But if you use the wrong prompt, ChatGPT might not give you the right answers. It can be dangerous to rely on AI for writing your policies.”

Summary of HR policy best practices

How Xoralia helps support HR best practices

Xoralia can support many of the above HR policy best practices, for example:

• Providing a standard template for your HR policies - or even different types of HR policies - so that it includes the elements outlined in this blog.
• Supporting automated review reminders for policy owners so HR policies always remain up to date.
• Establishing custom review and approval workflows for new or updated policies so these go through the correct process and can involve different stakeholders from across the business
• And more!

Our thanks to Sarah for sharing her excellent insights with us for this article.