Is Employee Record Keeping Important?

Unless you’ve dealt with employee record keeping before, you might be amazed at the amount of paperwork that you will need to keep. Did you know that one day you might be issued a subpoena if one of your employees is involved in a domestic dispute? That subpoena imposes a legal obligation on your organization to provide documents ranging from attendance records to payroll records.  Failure to properly respond can result in fines or other sanctions.

What Records Need to be Kept?

Various government regulations, including those from the Equal Employment Opportunity Commission (EEOC), require that employers keep all personnel or employment records for one year, and for one year from the date they are terminated or quit. Other records may need to be kept even longer. Records concerning employee benefit plans, any written seniority or merit system, must be kept for the full period the plan or system is in effect and for at least one year upon its termination. Employers must keep records including wage rates, job evaluations and collective bargaining agreements. These requirements apply to all employers covered by federal anti-discrimination laws, regardless of whether a charge has been filed against the employer. If a charge is filed, these records must be kept until the final disposition of the charge or any lawsuit based on the charge.

How About Those That Never Became Employees?

Think you can just dispose of job applications once you’ve hired someone? Wrong! Employers are required to keep job applications from one year from the date the application was received. Not only do various federal agencies have their own record-keeping requirements, but individual state and local statutes and regulations must also be considered. Adding to the challenge of record keeping is the fact that some obligations are dependent on the number of employees at a company.

Is Help Available?

One invaluable service that a Human Resource Consultant (HRC) or Professional Employer Organization (PEO) can provide is assistance with organizing and maintaining a comprehensive records management system.

Such a system can help with:

  • Controlling the creation, growth and accessibility of company records
  • Assisting in regulatory compliance and reducing litigation risks
  • Protecting sensitive information and defending against employment-related litigation
  • Ensuring that records are readily accessible

If that doesn’t convince you of the importance of record keeping – perhaps being accused of “spoliation of evidence” will. Yes, an employer can be sued for wrongful destruction of employment records.

What Records Can Be Disregarded?

Keep in mind that not everything is a “record,” so it is not necessary to include drafts or works in progress, only final versions of documents.

Hiring File? What’s That?

Understanding what a hiring file should contain will definitely wake you up. A hiring file includes documents and actions taken for the hiring of each position and can include: job advertisements, resumes, job applications, job orders submitted to any agency, interview evaluations, reference checks, results of physical examinations, employment test results, credit reports, validity documentation of tests used in the selection process, applicant data for candidates that are not hired AND “any related information.” Related information can be such things as signed acknowledgements of receipt and agreement with the company’s employee handbook, code of conduct and other key policies and emergency notification forms.

These records must be maintained for candidates that are hired as well as those that aren’t. See? The Devil is definitely in the details when it comes to employee record keeping.

Who Are The Experts?

Call EmployerNomics if you would like help with a PEO or HRC.
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