Record keeping, Part 1: What to keep and for how long
Record keeping plays an essential role in running any business. A wide range of employee information must be retained for numerous reasons. This includes the ability to facilitate efficient and effective human resource management, advocate for employment decisions when the need arises, and comply with numerous federal and state laws.
All records must be kept for a mandatory minimum number of years. The time varies from document to document, but in all cases, employers must ensure that records are stored in a secure location that can only be accessed by authorized personnel. Once their deletion is permitted, care must be taken that they are destroyed properly, whether by shredding, completely erasing from digital storage, or otherwise.
The following is a detailed analysis of the various categories of records that require preservation:
Hiring records
Hiring records include external announcements and internal postings for open positions, job applications submitted to employment agencies, resumes, applications, interview evaluations, pre-employment tests, and reference checks. The records of a person you decide to hire should be filed in his personnel file. If an employer does not hire the person, the person must store the records in an applicant file.
Documents related to hiring records must be kept for a minimum of 2 years after the employment relationship has ended, as required by Title VII, FEHA, ADA and ADEA.
Employee Personnel Files
Employee personnel files must include the employee’s title, classification, and job description. The file must also contain the job offer letter, performance observations and evaluations, promotions, demotions, attendance records, absence notices, disciplinary notices, transfers, layoffs and retirements, training , tests (including certificates), reasonable accommodation requests. and acknowledgments of receipt of company policy and manual.
Personal files must be kept in an exceptionally safe place for a period of 3 years after the termination of the employment relationship.
Employee wage records
Employee wage records include wage rate calculation tables, piece rates, individual employee hours and days, time cards, shift schedules, and any record that clarifies the wage gap between the sexes.
Employers must keep employee wage records for at least 4 years, according to the California Labor Code, the EPA (Equal Pay Act), and the FLSA (Fair Labor and Standards Act).
payroll records
Payroll records consist of name, date of birth, address, SSN, job definition, terms and conditions of employment, pay rates, union and employee contracts, child labor certificates and notices, the start and end of each workweek, daily total and pay period hours, total wages paid on each payroll, net wages and deductions, meal periods and split shift schedules.
Payroll records must be kept for at least 4 years after termination of employment.
Employee polygraph test
Although the Employee Polygraph Protection Act (EPPA) generally restricts the routine use of lie detector tests, they are used from time to time, such as in a robbery investigation by a employee.
The law requires employers to keep a copy of the statement given to employees indicating the reason for the test, the incident under investigation, the loss suffered by the employer, the notice given to a polygraph examiner naming the person or persons to be examined, the nature of the employee’s access to the person or property under investigation, and all documentation related to the actual test.
A statement stating that an examination was requested may be placed in the personnel files, but the remaining related documentation must be stored in a separate, confidential filing system for a minimum of 3 years.
As we always recommend with these delicate and complex labor laws, it is best to consult a professional human resources consulting firm or specialist to review policies and confirm that your record-keeping practices are in compliance.
In our next article, we’ll continue our investigation of the various records that require preservation, examine exceptions to standard record-keeping practices, and uncover the consequences of negligent record-keeping.