One of the inconvenient truths about HR is that, even in this modern age, there is a lot of paperwork. And a lot of rules about how long employers need to retain said paperwork. Let’s break down some of the most common records and how long you need to keep fighting the paper cut monster with each based on federal rules for most employers. Be sure to check the records retention requirements for your type of business and state rules too.
Another truth about active employee personnel files is that many HR practitioners keep active files with all of the records throughout the individual’s employment, in case there is an employment dispute later. Here’s why:
You need to keep your files for a longer period of time if there is a charge of discrimination filed under Title VII of the Civil Rights Act, the Americans with Disabilities Act (ADA), the Age Discrimination in Employment Act (ADEA), or the Genetic Information Nondiscrimination Act (GINA). In the event of a civil action brought by the Equal Employment Opportunity Commission (EEOC) or the Attorney General, you must retain all records related to the charge or action until “final disposition” as defined by the EEOC. The date of final disposition means the expiration date of the statutory period within which the employee may bring an action in a U.S. District Court or, where such an action has been brought, the date on which such litigation is terminated.
One Year/52 Weeks/365 Days
Selection and Hiring
However you want to mark time, records related to employee selection and hiring need to be retained for one year after a hire/no hire decision or the creation of the document (whichever is later). So even if you determined a candidate was not a fit for your company, you need to hang on to the resume, application, interview notes, and anything else related to the hiring process. Do you use pre-employment screening tests? Keep those for a year. Post a job ad? Keep it for a year. The one-year clock starts ticking when the final hiring decision is made or the job requisition is cancelled, so if you have had a long interview process, the retention time will be longer than one year. Qualified federal contractors should retain records for three years. If you are subject to the Department of Transportation requirements for pre-employment drug screening, keep those records for five years.
Promotion, Demotion, Transfers and More
Once you bring an employee onboard, you’ll begin to generate paperwork as part of the normal lifecycle. The federal requirements say you must keep files for one year that are related to:
- Employment Termination
- Performance Evaluations
Involuntary Employment Terminations
If an employee is involuntarily terminated, their personnel records must be kept for at least one year from the date of employment termination.
Finally, keep requests for reasonable accommodation from employees and applicants and your responses for a full year from the record date or action, whichever is later. (Public employers should retain for two years.)
Two Years/104 Weeks/730 Days
Some Compensation Records
If you pay different wages to employees of the opposite sex in the same workplace, retain all records that explain the rationale for the different wages, including wage rates, performance evaluations, collective bargaining agreements, and merit or seniority system documentation, for a minimum of two years in case of a wage-hour audit or employment complaint.
Three Years/156 Weeks/1,092 Days
Payroll Records and Timesheets
Keep basic employee data such as name, address, Social Security number, and so on for a minimum of three years. Compensation records, like amounts and dates of payments, total hours worked each day and workweek, annuity and pension payments, and fringe benefits payments should be retained for a minimum of three years. In addition, employment law experts recommend that employers retain these records for the entire length of employment plus an additional five years regardless of termination reason based on recent lawsuits challenging unequal pay practices. You may want to begin shopping for more filing cabinets.
Hang on to Forms I-9 and copies of all documentation for three years after the date of hire or one year after the date of termination, whichever is longer.
Family and Medical Leave Act (FMLA) Records
If you have FMLA-eligible employees, keep basic payroll and identifying employee data, dates FMLA leave is taken, copies of employee notices of leave, documents describing employee benefits or employer policies and practices regarding taking paid and unpaid leave, hours used with intermittent leaves, premium payments, dispute records and medical certifications or recertifications for a minimum of three years. Retain all FMLA requests for this time period, even requests that were denied.
Polygraph Test Records
Hold on to the statement concerning the activity or incident under investigation and the basis for testing a particular employee, all of the documents furnished by the examiner, and a copy of the written notice to the examiner identifying the employee for three years from the date of the exam or from the exam request date if no exam is conducted.
Four Years/208 Weeks/1,456 Days
Income Tax Withholding
A pessimist once said that the only two certainties in life are death and taxes. Optimistically, you need to keep records relating to FICA and FUTA income tax withholding for four years from the date the tax is due or paid.
Five to 30 Years/At least 260 Weeks/1,820+ Days
OSHA wants you to keep a variety of forms for the present year plus the five preceding calendar years. These forms include:
- Form 101, Supplementary Record of Occupational Injuries and Illnesses (Form 301 replaced this)
- Form 200, Log and Summary for Occupational Injuries and Illnesses (Forms 300 and 300A replaced this)
- Form 300, Log of Work-Related Injuries and Illnesses
- Form 300A, Summary of Work-Related Injuries and Illnesses
- Form 301, Injury and Illness Incident Report
There are some OSHA records that should be retained for 30 years, or 30 years plus the duration of employment. These records pertain to employees exposed to harmful toxic substances or harmful physical agents.
Employee Benefit Records
Records concerning employee benefits and beneficiaries (for example, 401(k) plan records and health and welfare plans subject to the Employee Retirement Income Security Act (ERISA)), Summary Plan Descriptions and other documents that describe your benefits offerings, and COBRA records should be kept for a minimum of six years or indefinitely. The key is to keep them for as long as they may be relevant to a determination of benefit entitlements. While there are no specific records retention rules for COBRA events, benefits experts suggest that the ERISA rules may apply. If you are challenged to prove that an employee should have received certain benefits years later, you need to have proof to support the benefits you provided.
Military Leave Records
All records related to military leave of absence and reemployment and employee benefits during or upon return from military leave should take up permanent residence in your file cabinet.
This is not intended to be an exhaustive accounting of all types of records employers must keep but a representation of the most common employee-related documentation employers are required to retain under federal law for a variety of purposes. Given the volume of documentation associated with the employee lifecycle and doing business, many employers are moving to electronic file storage. In next month’s issue, we’ll dive into electronic recordkeeping best practices, including security and audit preparation.
Whenever you are in doubt about retaining a document, hang on to it or seek legal advice before you destroy it.