Personnel files can help employers organize and preserve documented employment decisions as well as meet requirements to comply with certain recordkeeping laws. For these and other reasons, an employer should maintain a personnel file for each employee. Here are some key points about personnel files.
Include this information in personnel files
Generally, personnel files should include information related to:
- Hiring (such as application and resume, promotion, demotion, transfer, layoff or termination)
- Status as exempt or non-exempt employee
- Rates of pay and salary history
- Training records
- Job descriptions
- Employee handbook acknowledgments
- Performance reviews and any disciplinary actions taken against the employee
Some states have specific requirements for what must be included in personnel files. Check your state law to ensure compliance.
Keep in mind that a few states require employers to notify employees when they place negative information in their files. For instance, Massachusetts requires employers to notify an employee within 10 days of adding any information that has been used, or may be used, to negatively affect the employee's qualification for employment, promotion, transfer, additional compensation, or the possibility that the employee will be subject to disciplinary action.
Keep this information separate from personnel files
The following information should NOT be kept in personnel files:
- Any information reflecting an employee's membership in a protected group, such as their voluntary self-identification of gender, ethnicity, or race, veteran's status or as an individual with a disability. These records should be kept in a separate confidential file.
- Any document relating to an employee's health or medical condition, including doctor's notes and medical certification forms, drug test results, and accommodation and leave requests based on an employee's injury or disability. These records should be kept in a separate confidential file.
- I-9 forms and supporting identity and work authorization documents. It's a best practice to store all I-9 forms together in one file, since they must be produced promptly following an official request.
- Records concerning workplace investigations (written statements from all relevant parties, interview notes, final investigation report, etc.) should be kept in a separate workplace investigation file.
- Background checks. Keep background check records secure at all times and limit the information only to those with a “need to know.” Background checks should generally be kept separate from personnel files in a confidential file.
Employee access to their own personnel file
Numerous states have enacted laws requiring employers to grant employees access to their own personnel file upon request. These states are listed below.
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In some cases, these laws also:
- Cover former employees;
- Require employers to notify employees of their right to access their personnel file; and/or
- Entitle employees to include a rebuttal in their file, if they disagree with their employer’s information.
Some states expressly allow employers to have a witness present when employees inspect their personnel files. If there's no prohibition, it's a best practice to have a witness present. Employers should review their state law carefully and make sure they understand their rights and responsibilities.
Retaining personnel files
Various laws establish minimum retention periods for employee records, and some of these extend well beyond termination. For example, the Immigration Reform and Control Act (IRCA) requires all employers to retain I-9 forms for three years from the employee's date of hire or one year following their separation from the company, whichever is later.
Federal nondiscrimination laws require certain documents (e.g., hiring documents, performance records and accommodation requests) to be kept for at least one year from the date the records were made, or from the date of the personnel action involved, whichever is later. If a complaint is filed, employers must retain these records until the final disposition of the complaint. Other federal laws also have recordkeeping requirements. Additionally, your state and local laws may require longer retention periods and/or require employers to maintain additional records.
Generally, at the end of the retention period, employers should dispose of employee records so they can't be read or reconstructed. This may include burning or shredding the records; ensuring the destruction or removal of electronic media containing the employee information; or contracting with a reputable third-party vendor to properly dispose of the records in compliance with all applicable regulations.
Conclusion
Make sure you have adequate policies, procedures and training in place to comply with the federal, state and local rules governing recordkeeping and personnel files.