Our Human Resources Blog

Are your employee files kept locked and confidential?  Are they up to date?  Do your documents get filed in a timely manner?  Does your organization have security procedures in place for maintaining medical and other protected information?  These are all important questions that businesses should be asking and addressing. 

Periodic reviews of employee files and records maintenance procedures can reduce liability issues and non compliance penalties for businesses.  Because of the many laws affecting each stage of the employment process, it’s critical for employers to regularly review their practices to ensure regulatory compliance and avoidance of fines and/or lawsuits. 

An audit of employee files should include checking for proper filing procedures, security and access, verifying legal compliance with the documents and records collected and kept in the files, and checking the length of time the files are retained. 

There are also a number of laws relevant to employment files that businesses need to consider.  These include: 

I-9 Audits. An unexpected I-9 audit can bring with it a multitude of penalties if I-9 forms are not in compliance. It is in the employer’s best interest to take proactive steps to review, document and correct I-9 form mistakes prior to an outside audit in order to reduce assessed fees and penalties.  

Nondiscrimination. Only information relevant to employment decisions should be kept in the personnel file. Anything that is not relevant to the job or includes any information that distinguishes an employee’s protected class should be kept confidential and separate from the personnel file. 

Medical Privacy:  The Health Insurance Portability and Accountability Act of 1996, the Health Information Technology for Economic and Clinical Health Act, and the Americans with Disabilities Act protect your employee’s private medical information.  There are also Federal laws that require employers establish specific policies and procedures for maintaining employee medical information.

Identity theft. Employers obtain employee personal information, including employee Social Security numbers, for payroll and other employment purposes. Security and maintenance of these employment records is imperative to avoid company liability if these records are accessed and used for identity theft purposes.

Record retention. Employers must follow state and federal record retention laws.