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Definition of Company Policies

Updated February 21, 2017

Society is based on policies. There are policies for driving a car, policies for filing your taxes and policies for registering your child for soccer. Companies have policies, too, and these policies are put into place to maintain order and consistency in the workplace.

Definition

Policies are rules. According to BNET, a policy is a statement that defines the behavioural expectations of employees, or sets a standard for how a procedure should be followed across the organisation.

Function

Company policies give employees guidance about what is expected of them. They define things such as what types of clothes are appropriate and inappropriate and what behaviours are acceptable and unacceptable. The purpose of company policies is to give employees the information they need to succeed within the organisation.

Benefits

Policies give employees a clear understanding of their role within the organisation. Employers benefit from having policies, too, because they serve as soft agreements (not formal contracts) with employees, so if employees breach a policy, there is documentation to support the employer’s reprimands.

Effects

Company policies establish consistency and standardisation. A company will be more organised and systematic when it has policies in place, which allows room for more productivity.

Considerations

Policies are subject to change. When policies are amended the new versions of them must be released to employees so that they are up to date with the new standards.

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About the Author

Kyra Sheahan has been a writer for various publications since 2008. Her work has been featured in "The Desert Leaf" and "Kentucky Doc Magazine," covering health and wellness, environmental conservatism and DIY crafts. Sheahan holds an M.B.A. with an emphasis in finance.