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 Tennessee, while there is no specific state or federal law mandating that employers provide an employee handbook, it is a common practice for employers to distribute handbooks to communicate various policies and procedures required by law. These handbooks typically outline the company's history, mission, values, policies, procedures, and employee benefits, serving as a resource for employees to understand their workplace and reduce the need for direct inquiries to HR or management. When distributing handbooks, Tennessee employers often request employees to acknowledge receipt in writing. However, it is crucial for employers to ensure that the handbook does not inadvertently create a contractual agreement that could alter the at-will employment relationship, unless intended. At-will employment means that an employee can be terminated at any time without cause, and a poorly drafted handbook could potentially be interpreted as providing greater job security than intended. Additionally, employers must be cautious not to include language in the handbook that could be seen as limiting employees' rights to engage in protected, concerted activities, such as discussing wages, benefits, and other terms and conditions of employment, as these rights are protected under the National Labor Relations Act (NLRA).