Simple steps to get started—even if you’re not an HR expert.
Creating a leave policy may not be the flashiest item on your to-do list, but it’s one of the most important building blocks for small businesses looking to grow with clarity and compliance. Whether you’re a team of five or fifty, having a written leave policy sets expectations, protects your business, and supports your employees.
If you’re not sure where to start, don’t worry—you’re not alone. Let’s walk through how to create a leave policy that works for your team (and your time).
1. Understand the Basics: What Kind of Leave Are We Talking About?
Before you write anything down, get clear on the types of leave your policy needs to cover. Most small business leave policies include:
- Sick leave
- Vacation or PTO (paid time off)
- Parental leave (maternity, paternity, adoption)
- Bereavement leave
- Medical leave (short- or long-term)
- Jury duty or civic leave
- State-mandated paid leave (like Paid Family & Medical Leave in states like MN, CO, WA, AK, etc.)
LeaveAssist Tip: Even if your company is small, you may be subject to certain local or state leave laws. Always check whether your state has requirements for paid sick leave, family leave, or safe time.
2. Decide What’s Required—and What You Want to Offer
Leave policies must meet legal requirements, but that’s just the starting point. Think about:
- What does the law require you to offer based on your state, city, and company size?
- What kind of culture do you want to build?
- Do you want to combine vacation and sick time into one PTO policy?
- Will you offer paid leave, unpaid leave, or both?
Your leave policy is a reflection of your values. Small, thoughtful policies—like a day off for birthdays or floating holidays—can go a long way in making employees feel seen.
3. Put It in Writing (Really—Write It Down)
Once you’ve decided what kind of leave you’re offering and who it applies to, it’s time to draft the policy. At minimum, your policy should include:
- Who is eligible (e.g., full-time, part-time, after 90 days)
- How leave is accrued (if applicable)
- How leave is requested and approved
- What documentation is required (e.g., for medical leave)
- How unused time is handled (carried over or forfeited)
- What happens to unused leave if an employee leaves the company
LeaveAssist Tip: Keep your policy clear, friendly, and free of legalese. The goal is for every employee—and manager—to understand it without a law degree.
4. Communicate It Well (and Early!)
Once your policy is finalized, make it part of your employee onboarding and training. You might include it in:
- Your employee handbook
- A new hire welcome packet
- A shared HR document or internal system
Don’t just bury it in a handbook—train managers on how to apply it fairly and answer questions. Inconsistent application of leave policies is one of the biggest risks for small businesses.
5. Review It Regularly—Especially as You Grow
Leave laws change often (especially state-mandated leave), and so does your business. Review your leave policy at least once a year to make sure:
- It reflects current laws
- It still fits your company’s size, structure, and budget
- Employees are using it in a way that supports your goals
LeaveAssist Tip: Many employee handbook services monitor changes to regulations, including state-mandated leave, over the course of the year and alert you when the regulation changes. These services can save you time – just make sure you’re carrying those updates through everywhere your leave policies are posted!
Need a Hand? That’s What LeaveAssist Is For.
You don’t need to do this alone. LeaveAssist supports small businesses in navigating employee leave by taking administrative leave tasks off your plate. If the thought of managing leave makes you want to crawl under your desk, we’re here for that.