Employee Code of Conduct Template for Small Business
Quick Answer
An employee code of conduct is a short document that explains how everyone in the business is expected to behave: how to treat customers and coworkers, honesty, safety, use of company property, confidentiality, conflicts of interest and how to report concerns. A good code connects to your core values, uses plain language and real examples, applies to everyone including owners and managers, and explains what happens when it isn't followed. Have it reviewed so rules don't restrict rights employees have under federal labor law.
Every business has a code of conduct, whether it's written down or not. It's the set of unspoken rules about how people treat customers, how they treat each other, what's okay and what isn't. The problem with unwritten rules is that people interpret them differently, especially as a team grows.
A written code of conduct makes expectations clear for everyone. It helps new hires understand your culture, gives managers a consistent standard and protects the business when problems come up. This guide explains what to include, gives examples, provides a free template and shows how to roll it out and use it.
Note: This is general information, not legal advice. Some workplace rules can raise legal issues, so have an employment attorney review your code before you use it.
What Is an Employee Code of Conduct?
A code of conduct is a document that describes the behavior expected of everyone who works for the business. It's broader than a single policy. It sets the overall standard, and points to detailed policies, such as attendance, harassment or safety, where needed.
| Code of conduct | Employee handbook | Individual policy | |
|---|---|---|---|
| Purpose | Overall behavior standards | All policies and procedures | One specific topic |
| Length | Short, often 1 to 4 pages | Longer | Short |
| Example | "We treat every customer with respect" | PTO, benefits, pay, conduct and more | Attendance policy |
See do small businesses need an employee handbook and how to create an HR policy.
Why a Code of Conduct Matters
- Clear expectations for every employee from day one.
- Consistency. Managers apply the same standards to everyone.
- Culture. It brings your values to life. See core values examples.
- Customer trust. Employees know how to represent the business.
- Fewer problems. People are less likely to cross lines they understand.
- Fair discipline. Decisions are based on a written standard.
What to Include
| Section | What it covers |
|---|---|
| Purpose and values | Why the code exists and how it connects to your values |
| Who it applies to | Everyone, including owners, managers and part-time staff |
| Respect and fair treatment | How people treat each other and customers; links to the harassment policy |
| Honesty and integrity | Accurate time records, honest dealings, no theft |
| Safety | Following safety rules and reporting hazards |
| Customers | Service standards and professionalism |
| Company property | Proper use of equipment, vehicles and tools |
| Confidential business information | Protecting customer data and trade secrets |
| Conflicts of interest | Disclosing situations that could affect decisions |
| Gifts | What employees can accept from customers or vendors |
| Technology and devices | Appropriate use of systems and phones |
| Reporting concerns | How to raise questions or report problems |
| No retaliation | Protection for people who report in good faith |
| Consequences | What happens if the code isn't followed |
Free Employee Code of Conduct Template
[Company] Code of Conduct
Why we have this code: Our values are [value], [value] and [value]. This code explains how we live those values every day with customers, each other and our community.
Who it applies to: Everyone who works for [Company], including owners, managers, full-time, part-time and seasonal employees.
1. Treat people with respect. We treat customers, coworkers, vendors and visitors with courtesy and respect. Harassment, discrimination, bullying, threats and violence are not tolerated. See our Anti-Harassment Policy and Workplace Violence Prevention Policy.
2. Be honest. We record our time accurately, report information truthfully and never take anything that doesn't belong to us.
3. Work safely. We follow safety rules, use required protective equipment and report hazards and injuries right away.
4. Take care of customers. We are on time, communicate clearly, keep our promises and fix problems when we make mistakes.
5. Protect company property. We use tools, vehicles and equipment for work and take care of them.
6. Protect confidential business information. We protect customer information, pricing and other confidential business information, and only share it with people who need it for work. This does not limit any rights employees have under the law.
7. Avoid conflicts of interest. We tell [owner/manager] about any situation where our personal interests could affect our work decisions, such as working for a competitor or doing business with a relative.
8. Use technology responsibly. We follow our technology and cell phone policies and use company systems appropriately.
9. Speak up. If you see something that doesn't seem right, or you have a question about this code, talk to [manager], [owner] or [contact]. We will not retaliate against anyone who raises a concern in good faith.
10. Consequences. Not following this code may lead to coaching or discipline, up to and including termination, depending on the situation.
Acknowledgment: I have read and understand this Code of Conduct.
Signature: [ ] Date: [ ]
Have an employment attorney review the template, especially the confidentiality and technology sections.
Keep It Consistent With Federal Labor Law
The National Labor Relations Board says employers may not promulgate or enforce work rules that reasonably tend to inhibit employees from exercising their rights under the National Labor Relations Act, which include engaging in protected concerted activity, such as acting together with or on behalf of coworkers about working conditions. Broad rules about confidentiality, criticizing the company, social media or recording can raise issues. Keep rules tied to clear business needs, use specific language and have an attorney review the code.
Examples That Bring the Code to Life
| Code section | Example of meeting it | Example of not meeting it |
|---|---|---|
| Respect | Calmly helping a frustrated customer | Mocking a coworker's accent |
| Honesty | Correcting a time card mistake right away | Asking a coworker to clock you in |
| Safety | Wearing eye protection when cutting | Skipping lockout steps to save time |
| Customers | Calling ahead when running late | Leaving a job site messy |
| Property | Reporting a damaged tool | Using the company van for personal moves |
| Confidential business information | Locking customer files | Sharing a customer's address with a friend |
Real examples make the code easier to understand and apply. Ask your team for examples from your own business.
How to Roll Out a Code of Conduct
- Draft it with input from a few employees and managers.
- Have it reviewed by an employment attorney.
- Introduce it in a team meeting, explaining why it matters and walking through examples.
- Collect signed acknowledgments.
- Add it to onboarding for every new hire. See the new hire orientation checklist.
- Post it where people can find it.
- Review it once a year.
Handling Code of Conduct Violations
Not every violation deserves the same response. Match the response to the situation:
| Situation | Typical response |
|---|---|
| Minor, first-time issue | Private coaching conversation |
| Repeated minor issues | Written warning. See written warning templates |
| Serious issue | Investigation and stronger discipline |
| Violence, theft or harassment | Investigation; may lead to termination |
Document conversations and actions, and apply the same standard to everyone, including managers and top performers. See how to write up an employee.
Common Code of Conduct Mistakes
- Too long or full of legal jargon.
- Vague rules like "be professional" with no examples.
- Exempting owners or managers.
- Overly broad rules that may conflict with employee rights.
- No reporting process or no retaliation protection.
- Inconsistent enforcement.
- Never mentioned after onboarding.
Code of Conduct Checklist
| Step | Done? |
|---|---|
| Connect the code to your core values | |
| Cover respect, honesty, safety, customers, property, confidentiality and conflicts | |
| Use plain language and real examples | |
| Include reporting options and no retaliation | |
| Have it reviewed by an attorney | |
| Introduce it and collect acknowledgments | |
| Add it to onboarding | |
| Review it once a year |
Connecting the Code to Your Core Values
The most effective codes of conduct grow out of a company's values. For each value, describe what it looks like in everyday behavior:
| Value | What it looks like in practice |
|---|---|
| Do it right the first time | Follow checklists, double-check work, ask when unsure |
| Tell the truth | Report mistakes quickly, record time accurately, give honest estimates |
| Treat every customer like family | Show up on time, clean up after the job, follow up |
| Have each other's backs | Help teammates, share information, cover shifts when you can |
When the code reflects how your best people already act, it feels like a description of your culture rather than a list of rules.
Conflicts of Interest and Gifts
Small businesses often have close relationships with customers, vendors and family members, which makes clear guidance on conflicts helpful:
- Disclose any situation where personal interests could affect work decisions, such as a relative who is a vendor.
- Avoid side work that competes directly with the business. See moonlighting policies.
- Set a simple gift rule, such as accepting small gifts like a holiday card or snacks, but declining cash or expensive items.
- Ask before accepting anything that might create an obligation.
Using the Code in Everyday Management
A code of conduct is most useful when it's part of normal conversations, not just a document signed at hiring:
- Recognize employees who live the code, in huddles or team meetings.
- Use code language in feedback: "That was a great example of telling the truth even when it was hard."
- Refer to the code in one-on-ones when discussing behavior.
- Include code expectations in performance reviews. See the performance review template.
- Share real stories, good and bad, at team meetings.
Questions Employees Often Ask
"What if I'm not sure whether something breaks the code?" Ask your manager or another contact before acting.
"What if a manager breaks the code?" Report it to another contact listed in the code. The code applies to everyone.
"Will I get in trouble for reporting a concern?" No. Retaliation against anyone who reports in good faith isn't allowed.
Code of Conduct for Remote and Field Employees
Not everyone works in the same building. For remote and field employees, add a few specific points:
- Professional conduct on video calls and in written messages.
- Respect for customers' homes and property on service visits.
- Accurate time records when working away from the office. See how to know if remote employees are working.
- Safe use of company vehicles.
- Protecting customer information on personal devices.
Example: A Code of Conduct in a Small Service Business
A 20-person cleaning company writes a one-page code based on its three values: show up, do it right and treat every home like your own. Each value has two or three plain-language examples, like "text the customer if you'll be more than 10 minutes late" and "never take photos inside a customer's home without permission."
The owner reviews the code with every new hire on day one and mentions one example in each monthly team meeting. Customer complaints drop, new hires say they understand expectations faster and managers spend less time on the same conversations over and over.
Updating Your Code
Review the code at least once a year and whenever your business changes, such as adding services, locations or remote work. Ask managers which questions come up most often, and add examples that answer them. Share the updated code with everyone and collect new acknowledgments.
Getting Buy-In From Your Team
A code of conduct works best when employees feel it describes them, not when it feels imposed. Before finalizing the code, share a draft with a few employees from different roles and ask: Is anything unclear? Is anything missing? Does this sound like us? Use their examples in the final version. When people help shape the code, they're more likely to follow it and to speak up when something doesn't match it.
After the rollout, ask for feedback again in a few months, and keep improving it.
Code of Conduct and Discipline Records
When a code of conduct issue leads to discipline, note which section of the code was involved, what happened, what was discussed and what's expected going forward. Consistent records make it easier to apply the code fairly, show patterns over time and support decisions if they're ever questioned. Keep records private and store them securely.
Small Business Code of Conduct Tips
- Keep it to a length people will actually read.
- Use "we" language so it feels shared.
- Include at least one real example for each section.
- Link to detailed policies instead of repeating them.
- Make sure owners follow it first.
- Bring it up regularly, not just at hiring.
A short, clear and lived code will do more for your culture than a long document no one remembers.
Start small, share it widely and improve it a little each year as your team grows.
Share Your Code of Conduct With Updoot
Updoot's SOP management keeps your code of conduct and related policies in one place, with acknowledgments tracked. The company intranet makes it easy to share updates, and onboarding tools help new hires read and sign it before day one.