The personnel file is often overlooked as simply a necessary storage unit for your employees’ information. But did you know that an employee’s personnel file is considered a legal document? Should an employee ever question your company’s actions in a court of law, the personnel file can be your greatest ally or threat, depending upon the information contained within it.
The questions then arise: What information should and should not be kept in an employee’s personnel file? How many files should HR maintain for each employee?
Below are five best practices to keep in mind when managing personnel files:
Practice 1: Privacy
Keep all personnel information in a locked and secure place to ensure the privacy of your employees. Your employees trust HR to keep information—such as their home address, social security number and birthdate—confidential, and it is imperative to maintain that trust.
Practice 2: Files
Maintain at least two files for each employee:
- The first is the actual personnel file, which contains all recruitment information, signed policies and procedures, training records, performance evaluations and requests for time off.
- The second is an employee’s medical file. This file contains an employee’s medical, dental and vision enrollment information, drug test results, any Workers’ Compensation claims, ADA documents and FMLA information. Ultimately, any information that is Private Health Information (PHI).
Many employers create a third file for employees that have undergone investigations for misconduct. In this file, all filed complaints, disciplinary documents and witness statements are maintained separate from any of the employee’s other information.
Practice 3: Form I-9
Keep all employees’ Form I-9 in one binder. If the company is audited by the U.S. Citizenship and Immigration Services, this information can quickly be produced. It is required that Form I-9 be filed separately from the personnel file to ensure that information contained in the form is not considered when employment decisions are made—which is often done when a manager reviews a personnel file. While it is not a requirement to keep the company’s copy of identification documents along with the I-9 form, it is recommended to do so to keep the information handy if questioned during an audit.
Practice 4: One Set of Files
Do not allow supervisors or managers to maintain their own employee files for their direct reports. All employee information should be stored in the human resources department files to ensure that it is adequately secured and is not being used to make unsound employment decisions.
Practice 5: Industry and State Laws
Know the laws that pertain to your industry and state. Depending upon your company’s type of business and where it is located, there may be specific legal requirements mandating the information that is kept in the personnel files, whether or not an employee has the right to view their file(s) and how long certain documents must be retained.