As another year comes to an end, those pesky corporate housekeeping matters we tend to put on the back burner all year start to burn a little hotter. One of the common questions we hear from our clients this time of year sounds something like this: “Okay, so tell me again, what am I supposed to keep in these personnel files and how long do I have to make room for all this stuff?”
Rather than waiting for the inevitable e-mails or phone calls, we will address those questions now:
What are we supposed to keep in the personnel file?
Records and retention schedules of government employers are typically proscribed by detailed statutes, regulations, and policies with little opportunity for modification. Private employers in Washington and Oregon, with few exceptions, are not subject to the same level of regulatory guidance and therefore often consider the personnel file the place to tuck away anything and everything related to an employee. Some items are probably required to be included, but some likely are not.
To alleviate some of that confusion and avoid legally prohibited overinclusion, here’s a list of what should not be included in the same physical file as what we will refer to as the “primary personnel file,” but must still be maintained in a separate file during employment and made available for inspection, audit, or production when required: medical information, pre-employment screening information, retirement plan information, I-9 employment eligibility forms, internal investigation records, child support orders, and wage garnishment records.
Some items that should be included are: job applications, resumes, licenses, accredidations, reference letters or notes, Fair Credit Reporting Act (FCRA) notices and disclosures, performance reviews, evaluations, disciplinary records, awards, W-4 and withholding information (except for child support orders and wage garnishments), training and continuing education records, and benefit enrollment forms (assuming they don’t disclose private health information).
How long should personnel records be retained?
Most employment-related claims that can arise after an employee has been terminated have a 3-year statute of limitations, although some may be longer or shorter depending on the specific claim at issue. That means that as a general rule and unless a statute expressly requires they be maintained longer, we generally recommend that all employee-related records be retained for at least three years after the employee’s separation from employment. This includes:
1. The full employee personnel file, including all the separate components listed above, which may be merged into a single location after termination, and include:
• The primary personnel file listed above.
• The required payroll information.
• Any child support or garnishment court orders and records of court-ordered withholdings.
• The separate medical information file and any other FMLA-related documents including the dates and increments of FMLA leave, the notices given the employee and employer, and records of any leave denials or disputes with an employee over FMLA or other required leaves. This should also include disability accommodation requests and related correspondence.
• The pre-employment screening information. Note also that FCRA has strict rules about destruction of consumer-related reports, including credit histories and criminal background checks, to guard against identity theft.
2. Documentation related to the company’s hiring activities, including:
• Job advertisements.
• Job applicant information, including application materials for all those not hired.
• I-9 Forms.
• EEO-1/VETS-100 Surveys.
A few personnel records should be kept longer than three years and include:
• Employment contracts, restrictive covenants (e.g., non-competition and/or non-solicitation agreements), and handbook acknowledgements should be retained for at least six years following the employee’s termination because of statute of limitation issues for contract claims in Oregon.
• Records of on-the-job injuries or illnesses, including the details of each incident (for employers with 10 or more employees), should be retained for five yearsafter the occurrence, or 30 years if exposure to toxins is involved.
• 401k and retirement plans (qualified and nonqualified), election forms, documentation regarding eligibility and vesting determinations, and records of contributions typically should be retained for at least seven years, and some, like the plan documents and tax filings associated therewith, might need to be retained for the life of the business, depending on the particular circumstances.
We hope you find this article helpful. As always, we recommend that you consult with legal counsel to make sure your own record retention practices are in compliance with the specific laws that apply to your business and are appropriately tailored to your individual business needs and employer obligations.
Peter Hicks is a Shareholder at Jordan Ramis PC and focuses his practice on employment law, business law, and commercial litigation. He has deep experience in a full range of employment issues and also serves as general counsel to his clients on a range of business and employment matters. You can contact Peter at 541.797.2079 or by e-mail at email@example.com.
Amy Robinson is a Shareholder at Jordan Ramis PC and focuses her practice on employment and business law. Amy regularly speaks throughout the Pacific Northwest on a variety of employment and human resources topics. You can contact Amy at 503.598.7070 or by e-mail at firstname.lastname@example.org.