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5 Tips for Improving Your HR Document Retention Strategy

Document Retention | Human Capital | Fahrenheit Advisors

When compliant record keeping of personnel files and employment documentation is done well, it’s an automated, organized, “this ship runs itself” situation. When done poorly, it’s file cabinets filled with loosely sorted accordion folders and banker’s boxes of the “we keep these separately” medical information folders. Cue the theme music from Halloween.

Perhaps Michael Myers is a bit of a dramatic reference, but the importance of a solid document retention and destruction policy cannot be undersold.

Keeping records indefinitely leads to clutter, and you run the risk of someone purging essential information just to “make space.” Destroying records too soon creates a separate set of problems with potential legal pitfalls.

In fact, carefully crafted and compliant document retention is cost-effective in many ways. Organizations save money on storage costs, avoid costly legal battles for early document destruction, and can utilize safely stored data to support future decision-making. Use the HR data you are required to store to inform future policy development!

Here are five tips to ensure your document retention strategy sits in that goldilocks sweet spot.

 

1. Know Your Compliance Requirements

In the United States, many federal and state laws require employers to keep different records for varying amounts of time. These laws include, but are not limited to, Title VII, the Age Discrimination in Employment Act, the Fair Labor Standards Act, the Family and Medical Leave Act, the Employee Retirement Income Security Act of 1974, the Equal Pay Act, and the laws governing the Occupational Safety and Health Administration. To further complicate the matter, applicability of the record retention requirements is often dependent on the number of employees. Additional requirements may apply if the organization is a government contractor. Certain records may be governed by more than one retention law, creating varying retention periods from a compliance standpoint.

Generally, you should retain the record for the longest period required. For most records, this includes a certain period after termination. Many employers will use the 7-year rule for terminated employee files, as this period typically covers federal and state statues of limitation. Shorter retention periods may work for files such as I-9 forms, but longer periods may be required for records such as OSHA exposure data.

Top-notch record retention policies bake in the concept of the “litigation hold.” When pre-litigation or litigation is initiated on an employment matter, employers should place a hold on destruction of any relevant and related employment records, even if the destruction would ordinarily occur under normal operating procedures.

 

2. Lockdown Access to Employment Files

Access to HR files should be limited to those who have a legitimate need to know the information or are legally required to have access. If you are dealing with paper files, this may mean locked cabinets in the HR Director’s office. If you have gone digital, you will need to ensure your system allows access protection. Many states have requirements about providing, either access to, or copies of personnel files to current and former employees, so include in your policy how you will manage these types of requests. If no state law governs, work with your HR department and legal counsel to ensure you are prepared to respond to requests for personnel files.

 

3. You Gotta Keep ‘Em Separated

Anyone else know that song?  Bueller?

In all seriousness, it is critically important to keep certain HR files separate from the rest of the employment data. Any medical information collected regarding an employee must be kept in a separate file from their other personnel records. I-9 forms must also be kept separate from other personnel files.

 

4. Go Digital

Getting it “right” when it comes to employee record retention can be incredibly complex.  Particularly for small or mid-size HR departments, managing a proper record retention and destruction program can be too taxing on already stretched-thin HR professionals. In these circumstances, the organization should strongly consider an electronic, automated record management platform. My colleague Kim Moore makes the business case for automation in this article.

 

5. Destroy with Confidential Confidence

Once you have established a compliant record retention policy, stick to the schedule and destroy the documents with confidence! A good rule of thumb is to destroy as you keep, meaning purge documents with the same level of confidentiality in which the document was kept. Your document retention policy should specify the exact way HR records are to be purged. Consider also setting up an auditing practice for the document retention policy to ensure compliance with your internal requirements.

Does this all seem like too much? Fahrenheit Advisors can help! Contact us at Experts@FahrenheitAdvisors.com to discuss getting your HR records in order.

 

About the Author

Dana Dews Gates is a strategic human resource professional focused on connecting culture and employee engagement with practical policies and procedures. Dana has worked both externally as an attorney and internally in legal and HR for several companies providing advice and counsel on various human resources matters.

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