Toward the end of the year, employers may wish to review their filing systems to make sure they are maintaining personnel information appropriately. All employers should have a system for retaining employee records.
Where Records Should be Located
Employee records are best kept in a locked file cabinet or secure area with access available to only limited HR professionals. If information is stored electronically, access should be restricted to those in the HR department with a need to know the information.
What Files to Maintain
Best practice is to store typical personnel-type information separate from medical information, benefits records and health plan information. Payroll records should also maintained separately.
Personnel File
The standard personnel file may consist of more than one component. Personnel files should include the following:
- Employment application (resume, background check, letters of recommendation)
- Job description
- Handbook acknowledgement form
- Signed employment policy documentation
- Performance reviews and records, including disciplinary documentation, if any
- Attendance records, including vacation/leave requests
- Employment records, including job change information.
Medical Record File
Information relating to health and welfare plan benefits should be kept in a separate file. This file may contain:
- Insurance and benefit enrollment form and claims information, if any
- Medical exam information if required for employment
- Drug testing documentation
- Medical documentation for FMLA leave
- Any other health records maintained by the employer.
Payroll File
Documentation relating to payroll should be maintained in a third employee file. This file will include:
- W-2 documentation
- Requests for loans from the employer
- Documentation relating to wage garnishment
- Employee time records.
I-9 Records
Form I-9 documentation can be kept separate from other personnel records.
Retirement Plan Records
Enrollment and other benefit plan information should be kept in a file dedicated for that purpose. This file can contain SPDs, SMMs, SBCs, and other specific plan documentation.
Other Processes
Each employer will have to evaluate their business needs to determine the filing system that is right for them. Other files might be necessary depending on business practices. State laws should also be considered, particularly laws governing access to employee records. In any case, the maintenance of separate, secure employee files is good business practice and a wise HR process.
