Every organization in the US has the obligation to maintain employee records for a certain period of time and to follow specific requirements for the creation of such a database. Here are some of the most important HR records retention regulations to keep in mind.
HR records retention regulations come on both state and federal level. Thus, businesses must acquaint themselves with the local framework, as well as the legislation that’s applicable across the country.
There are a few requirements that are applicable to all. For every single employee, a company should have a personnel file, a document outlining benefits and health-related data, supervisor working files, an investigative dossier (in the case of theft, fraud or sexual harassment) and I-9 forms.
For each of these documents, there will be a regulatory requirement for length of record retention. This requirement will once again vary from one state to another, making it very important to know what the local regulations are.
Federal Law Requirements
While local specifics may vary, federal HR records retention policies apply to businesses across the US. Here are some of the most important federal provisions that will apply to all businesses.
Per the Age Discrimination Employment Act, data about payroll, promotions, demotions, layoffs and recalls should be maintained for a period of three years. Documents that fall underneath the Equal Pay Act should be maintained for a period of three years, as well.
Documents that fall underneath the Fair Labor Standards Act (payroll and documents that contain an employee’s personal information) should be maintained in a database for a period of at least four years. I-9 forms are to be maintained for a minimum of three years after the date of hire and for one year after termination date.
Logs about occupational injuries and illnesses have a legal prescription of five years. Disability complaints are to be maintained until disposition and affirmative action plans have to be updated on an annual basis. More information about federal record retention requirements can be found on the Society for Human Resource Management website.
When federal guidelines come in conflict with state regulations, HR professionals have to follow the more conservative framework (the one that demands record retention for a longer period of time).
Destruction of HR Records
HR records retention legal frameworks also have prescription concerning the destruction of documents that are no longer required. All of the documents stored in the form of paper copies have to be shredded after the end of the recommended retention period. Such a procedure is applicable to all records about personnel, not only documents falling under the Fair and Accurate Credit Transaction Act (FACTA).
Data provided by job applicants who haven’t been hired (CVs, for example) are to be destroyed via shredding, as well.
The regulatory framework also includes provisions about the destruction of electronic records. HR professionals are required to partner up with the company’s IT department to review electronic databases at least two times per year, ensure compliance and purge all of the data that’s no longer required.
When it comes to legislation, paper and electronic HR documents are to be treated in the same way. There aren’t strict requirements about keeping documents on paper, which is why many companies have moved to digital record management options. These tend to be much more practical, affordable and easy to maintain. In addition, the restoration of lost data and ensuring legal compliance happen to be much easier when a good electronic document management system is chosen. Contact CASNET today to learn how easy document management compliance can be.