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Don't deprive yourself of an important management tool just because state courts have been treating policy statements in employee handbooks as binding contracts between companies and their employees. Handbooks are still an effective means of communicating values and standards, and with careful drafting you can avoid most legal problems. Here's a checklist from lawyer John Coombe, of Denver-based Holland & Hart:

* Don't include any statements you can't live with -- statements "so burdensome on the employer that, in the future, you may not be willing or able to comply."

* Avoid troublesome phrases such as "permanent employee" -- they can lead to a dispute over future terminations.

* Don't make strong promises. Instead of stating the company "will provide" or "will guarantee" something, say "the company will, whenever practical, provide," Avoid using "guarantee" altogether.

* Don't say that employees will be fired only "for cause." List all the reasons for firings. Many employers go so far as to include disclaimer language reserving the right to discharge at any time for any reason.

* At the beginning and the end of the handbook, include a disclaimer to the effect that "this is not a contract. It can be modified at any time."

* Review the handbook regularly and eliminate outdated rules.