How much time does your HR department spend filing, retrieving, accessing, and keeping up to date on your employee records? If your business is like most, this time-consuming and often frustrating task is one that your HR team spends many unnecessary hours on. If you have a larger company with hundreds or thousands of employees, employee records, and the time spent on them, can easily get out of hand and hurt your productivity. Fortunately, there are ways to develop an efficient record keeping system that will make the task easier and quicker for your HR department. Here is what your HR team needs to know to keep your company compliant.
What Records You Need to Keep
Your HR team should be up-to-date on the laws regarding employee records as well as the way to create a safe and secure employee record keeping system. Tossing records because of lack of space is a big mistake that could cost your company in fines and penalties. Depending on the type of record, there could be different time periods they need to be accounted for as well as different required storage methods. Here are the records you need to be aware of.
General Records
All companies need to keep track of personnel, medical and benefits, I-9, and hiring records. Personnel records should be kept for seven years after termination. Medical and benefits records need to be retained for six years after the plan date. I-9 records should be kept for three years after termination, and hiring records should be retained for two years after the hiring date.
Other Records
Depending on the type of business you have, you may be required to keep other types of records. These may include the following.
OSHA Records
The Occupational Safety and Health Association, or OSHA, requires companies to keep records related to illnesses, fatalities, and work-related injuries for five years. If you have employees who have been exposed to any occupational hazards or diseases, keep them for 30 years.
EEOC Records
The US Equal Employment Opportunity Commission requires you to retain records regarding personnel and employment. They include anything that is used to lay off, hire, promote, demote, or compensate employees. These records must be kept for one year after they are created or after an action is taken.
FLSA Records
The Fair Labor Standards Act requires employers to keep certain records for non-exempt workers. These include employees’ full names, addresses, and social security numbers as well as birth dates, gender, and occupation. Total hours worked and basics of pay should also be recorded and kept. These records should be kept for two years.
ADEA Record
The Age Discrimination in Employment Act of 1967 was put in place to protect employees over the age of 40 against discrimination. You should keep payroll records for three years and benefit plan information for one year after termination.
ERISA Records
The Employee Retirement Income Security Act pertains to private sector employees and establishes standards for pension plans. Forms need to be submitted every year, but there are no regulations on how long they need to be retained.
IRS Records
The Internal Revenue Services requires you to retain records showing income and expenses including pension payments, dates and amount of wages, and updated contact information for all employees. Your accounting department should be involved in all forms needed for tax purposes. All employment tax records should be kept for at least four years.
FMLA
The Family Medical Leave Act was instated to ensure covered employees could take unpaid time off to attend to personal medical or family issues. You must retain information on the leave employees take under this act for at least three years.
ADA
The Americans with Disabilities Act protects your employees with disabilities against discrimination in the workplace. Retain records pertaining to the hiring of those with disabilities as well as accommodations made for them. Retain records for one year after creating the record or after an action is taken.
Records Required by State Law
Different states have varied rules regarding what records need to be kept and for how long. Make sure your HR team is aware of all laws present in the state you do business. If you have locations in multiple states, all of their rules must be followed to stay compliant.
How to Make your Employee Record Keeping More Efficient
Keeping track of all necessary records to stay compliant can be a full-time job for your HR team. Fortunately, there are ways to make this process easier, more efficient, and more secure.
Make All Records Digital
Are you still keeping physical records in boxes or filing cabinets? If so, you’re causing more work for your employees and taking security and compliance risks. Physical files are in danger of theft and compromise. They can also be destroyed by fire, flood, or other natural disasters. When you store all of your records digitally, you increase efficiency as well as security. Records can be scanned and uploaded to a cloud-based storage platform and can be easily accessed whenever and wherever necessary.
Consider an HR Management Software System
Managing employee records can be a time-consuming and frustrating part of your HR team’s jobs. When you implement HR management software, you give them a valuable tool that saves them countless hours and ensures compliance with current laws. HR software can integrate all of your employee records and store them in a way that is easy to access. Everything from performance records to notes on paid time off as well as hiring and tax records can all be stored in one convenient online location.
Does your HR team have a convenient and efficient way to store and retrieve employee records? If you’re using an unsecured storage area to file boxes of physical records, you’re harming your company’s productivity. You could also be opening yourself up to harmful breaches, theft, or destruction of records due to fire, flooding, or other natural disasters. To keep your records safe and accessible, consider HR software that can organize, store, and retrieve all relevant files on one convenient platform.
