What Is Company Policy? (Importance, Tips and Examples)

By Indeed Editorial Team

Published 13 April 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Company policy involves the guidelines and rules that companies establish for employees. These policies generally help employees understand company expectations and culture. It's beneficial to learn more about company policy as all professionals follow a certain set of rules to secure their employment and stay safe in the workplace. In this article, we answer the question 'What is company policy?', explain their importance and provide information on how to review these professional guidelines with examples of common company policy types.

What is company policy?

Company policy describes the official code of conduct for an organisation. A company policy is a rule or guideline that the administration and executive professionals of the company establish to ensure each employee within the company follows the values and goals of the company. Company policies are official rules that protect everyone within the company by prioritising the safety of employees and the value and best interests of the company.

Many organisations choose to organise their policies in an accessible document, such as an employee guidebook. This allows everyone working at the company to understand how they might conduct themselves.

Related: What Does Human Resources Do? 11 HR Roles and Responsibilities

Why are company policies important?

Company policies are important because they protect you as an employee within your workplace. To understand more about the importance and impact of company policies, consider the following benefits they offer:

  • Safety: Having clear rules within the workplace can help ensure that you and your colleagues understand what to do in emergency situations.

  • Values: The policies that a company establishes often reflect its values. This is helpful as you can review these policies to gain a better understanding of the company's values and compare them to your own.

  • Instruction: Company policies include practical instructions to guide you through work-related tasks. They can also provide important information on elements such as pay and benefits.

  • Compliance: Company policies also ensure that the company itself acts in compliance with local laws and legislation. This can help protect your rights as an employee.

  • Efficiency: Establishing clear rules for workplace conduct and practices can also improve efficiency as it ensures you and your colleagues complete a task in the same way.

  • Benefits: Many company policy documents include information about the benefits you receive as an employee. This is helpful as you can use the document as a reference to understand more about time-off policies, insurance-related policies and other important details about your benefits.

Related: Flexible Work Arrangements Benefits (With Types and Advantages)

Tips for reviewing company policies

As an employee, it's important to read the company policies of the organisation for which you work. This can help you adjust your conduct within the workplace and keep you well-informed of your rights as an employee. Reviewing company policies is often a step within the onboarding process but managers usually expect professionals to review them independently. This means that the review of company policy is completely your responsibility as an employee. Here are some tips you might consider to help you review company policies:

Read thoroughly

Most companies feature their policies in their employee handbook. Read your employee handbook thoroughly to ensure you know about each company policy. Employee handbooks can often be longer documents, so you might consider reading it in stages. This can help you comprehend the information better and ensure you don't skim the content. Consider annotating a summary of policies for you to review later. Company policies often feature industry and legal jargon, so it may be helpful for you to annotate the company policy handbook as you read to help you understand the material.

Ask questions

Consider taking notes while reading the company policy document. If you encounter a policy that you want to know more about or don't understand, make note of it so you can ask questions later. It's helpful to contact a human resources representative to ask any questions you have about company policy. These professionals are often most equipped to answer policy-related questions and may also be able to provide additional resources for you to review. Asking questions about company policy can often help you gain more insight and shows your supervisors that you care about the company's rules and objectives.

Research the company

Many companies share their policies during employee onboarding, which means you may not be able to review a company's policies until after you gain employment. You might benefit from researching a company's policies before you accept a job offer. This can help ensure you find employment with a company that shares similar values as you. Some companies have public records of their company policies, so consider researching the company to try and find them. Then, review them to ensure you're happy with the benefits and practices the company has before accepting employment offers.

Notice any changes

While working for a particular organisation, take note of any changes they might make to the employee handbook and policies. Usually, when human resources professionals revise company policy, they make an announcement via email, memo or instant message. When this happens, consider reviewing the changes in the handbook. This can help you address any questions you may have about the change while it's especially relevant.

Company policies may also change following the passing of a new law or regulation, so if you notice a legal change, you might ask a human resources representative how this may affect the company for which you work.

Keep a copy of the employee guidebook

Many companies make copies of the employee guidebook available to all employees. Often, you can access a digital version of the company policy document. Consider downloading it to your computer or phone so you can have access to the document whenever you need it. If a human resources professional within the organisation updates a company policy, it's helpful to re-download the document to ensure you have the most up-to-date version.

Types of company policy

To help you better understand what company policies are and their importance, consider these examples of company policy types:

Workplace security

Workplace security policies aim to protect employees and company property, including intellectual data. These types of policies may include guidelines on appropriate safety gear for workspaces, such as a policy that requires hard helmets for any construction site. Workplace security can also include policies that detail how to keep company information and data safe by only using a work email and not taking work-issues laptops and technology home.

Substance abuse

Company policies that involve the topic of substance abuse. Most companies prohibit the use of any substances on company property but some may also clarify if they require employees to be abstinent of any substances at all times. Substance abuse policies may highlight protocols for drug testing in the workplace. It's also common for company policy's to establish a consequence if an employee doesn't abide by the substance abuse guidelines.

Related: Workplace Flexibility For Employers and Employees

Equal opportunity

This type of company policy promotes fair treatment and equal opportunities for each professional, regardless of their demographic identity. Equal opportunity company policies are often a legal requirement for companies. This ensures that professionals who may not have the same social advantages as others are still given a fair chance to succeed in their roles. Equal opportunity policies typically include anti-discrimination statements.

Related: Learning About Diversity And Inclusion: 10 Free Virtual Courses

Time off policies

Time off policies refers to the protocol employees follow to take breaks from work. These policies include practices for taking personal and sick leave. It's common for time-off policies to specify how many hours of paid time off an employee has and may include information on how to request longer leave periods. This information can help employees stay physically and emotionally healthy while maintaining a healthy work-life balance.

Related: What Are Employee Benefits and 17 Types of Employee Benefits

Employee conduct

Employee conduct describes the general expectations for how employees behave at work. These types of company policies typically include aspects such as the hours an employee usually works, appropriate work attire and rules for taking breaks during the workday. Company policies often outline the standard of employee conduct as a condition for a professional's employment.

Example of company policy

Here's an example of a company policy regarding reimbursement for company expenses:

Star Vision authorises reimbursement for any monetary value an employee spends in a reasonable, company-related circumstance. These circumstances can include transportation, parking fees, meal costs when travelling or at conferences and emergency office purchases. Employees are required to receive written permission to charge the company for purchases and receive reimbursement, though emergency cases can be considered on a case-by-case basis. In cases of valid reimbursement, employees shall receive a cheque that covers 100% of the cost previously spent by the employee.

Related: What Is a Code of Ethics in Business? (With Examples)

Explore more articles