Litigation Against Employers Is on the Rise
In recent years, lawsuits against employers has increased. it is imperative for employers to be well versed on employment law to protect the company’s bottom line and reputation. Employee record retention is crucial.
Your Company Must Establish a Policy
A designated records administrator is essential. if you have a human resources department, the human resources manager should have this handled; however, it is important for employers to sit at the table with hr department and ask the important questions. employee record retention can wreak havoc on your company if not handled properly.
Employers must know where they stand in regards to proper employment retention and destruction policies. it is not smart to just assume that everything is fine. in fact, some companies will hire an outside auditor to come in and make sure they are in compliance. This is actually a great practice.
When the personnel or human resources department know that they will be audited, this department will be more careful about records.
Having advanced time and attendance systems and well qualified personnel department or human resources department is key to protecting your company. Smaller companies generally have a human resources generalist that is well versed and experienced in employment law.
Employment Law Lawyers Are Important Too
Even the most qualified human resources professionals need to consult with employment law attorneys. Employment law changes frequently and the cost is too high to not be thoroughly prepared in this area. This is not an area that should be taken lightly.
Large corporations usually have a dedicated law firm; while smaller companies, usually consult attorneys when creating important materials and setting up their personnel department.
Federal laws regarding employee record retention are based on the number of employees within the company. Generally, the laws impose monetary penalties for failure to adhere to statutory record requirements. Following these guidelines is critical for any employer to avoid individual liability and criminal liability. In addition, it is important to abide by these standards to defend against possible litigation that is employment based.
Wrongful Destruction of Employment Records
One sure way to be sued pertains to wrongfully destroying employment records. The laws takes this very serious. The theory behind this is the employer is destroying evidence.
It is important to know what states require employment documents to be destroyed by shredding or rendering the document as unreadable.
For instance, to name a few states: South Carolina, New York, and Massachusetts are just some of the states that have this mandatory requirement.
Proper Handling of Employment Documents
The following employment documents must be maintained in separate storage in an human resources or personnel environment. where ever these documents are kept, they must be segregated.
- I-9 forms
- IHealth and Safety Records
- IPre-Employment Information
- IGeneral Information about Employees
How Long Do You Keep the Records of Job Candidates
Federal law requires that you keep employment records of job candidates not hired for 3 years. these documents include the following regarding ,employee record retention:
- Interview Records and Notes
- Application Records
- Other Pertinent Recruiting Information
How Long Do You Keep the Records of Terminated Employees
The law stipulates that the records of terminated employees be kept for 4 years. these records include the following:
- Related employment materials
- Interview records
Time Requirements for Other Employment Records
Job history, compensation records, and timekeeping information must be kept for 4 years following termination of the employee. fmla and userra information regarding employees must be kept for 3 years following termination.
The following documents MUST be kept for 4 years after termination:
- Disciplinary action records
- Performance appraisal
The following documents MUST be kept for 6 years after termination:
- Benefit records
- Form 5500: 6 years after report was filed
The Bottom Line: Protect, Protect Company Assets
A lawsuit against your company can result in damage to your company’s reputation, brand, and it will result in significant monetary penalties and damages paid to plaintiffs. This is unnecessary. It is imperative to be proactive.
As an employer, the way you handle all employment related records is vital. When recruiting for a position, the interview notes and applications must be kept for a certain length of time. When terminating an employee, those records must be kept for a specified time. If you follow federal laws and guidelines, you will be well prepared to deal with any possible litigation that may come your way.
Employment records are highly confidential and they must be stored and treated accordingly. Make sure you know the laws governing these records or hire a professional that knows employment law record retention policies. This is an investment that you must make for the well-being of your company.