Utilizing electronic records can be a way to reduce paperwork in your office, but do you know how to stay in legal compliance while utilizing electronic employee records? How do you ensure your files are safe in case of an emergency? In a CER webinar titled “Electronic Recordkeeping in California: How to Manage, Store, and Purge Employment Records in the Digital Age,” Marc L. Jacuzzi, Esq., outlined some answers to these questions.
Can You Keep Solely Electronic Records Under California Law?
Jacuzzi explained that, according to the California wage orders, “in general, records must be kept in indelible, typewritten or digital form . . . for all employees. The records must be dated and kept on file at a place of employment or at a central location within California.” Under the wage order, “the employee’s records shall be available for inspection by the employee upon reasonable request.” black magic
In the webinar, Jacuzzi went on to explain that this means that the use of electronic timecard systems, and the storage of records by electronic means meets the requirements of California law if the records are (1) retrievable in California, and (2) may be printed in an individual format upon request.
Regarding electronic records, the Division of Labor Standards Enforcement (DLSE) policy closely follows the federal regulation contained at 29 CFR 516.1, which is detailed here:
(a) Form of records. No particular order or form of records is prescribed by the regulations in this part. However, every employer subject to any provisions of the Fair Labor Standards Act of 1938, as amended (hereinafter referred to as the Act), is required to maintain records containing the information and data required by the specific sections of this part. The records may be maintained and preserved on microfilm or other basic source document of an automatic word or data processing memory provided that adequate projection or viewing equipment is available, that the reproductions are clear and identifiable by date or pay period and that extensions or transcriptions of the information required by this part are made available upon request.
Federal Contractor Electronic Record Requirements
Reading the guidelines above makes the record requirements seem straightforward enough; however, this doesn’t give much detail on how, exactly, records should be kept. What does this mean for employers in California who wish to utilize electronic records?
Jacuzzi said his recommendation would be “to follow what is stated for federal contractors because they have a lot of good information in there . . . what the federal contractors require is . . . that the contractors may destroy original paper documents and keep them in electronic format if the following conditions are met: one is that they have been put in place on the electronic storage system and there are backup procedures and security systems in place.”
The California law doesn’t say anything about back-ups, however, it does say that they need to be retrievable upon request. As such, it makes sense to ensure that you have the backup procedures in place so you can meet this requirement. If you have an outside service provider, be sure you know what their backup procedures are. If you’re doing this internally, have backup storage devices. Also, be sure you have emergency backup as well that is in a fire and earthquake-protected area.
The federal contractor regulations also discuss the requirement that the electronic storage system may be easily accessed by the Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP), which may come into play during an investigation, for example.
Additionally, it states that the duplicate electronic must accurately reproduce the original, which means it must be legible and must constitute a substitute copy of the original under federal law. Jacuzzi explained that “oftentimes when a wage claim, for example, comes up or you’re asked to produce documents in response to an administrative charge by the EEOC or the DFEH, and you go and you print your electronic files and . . . [discover] the signature has been cut off or the right margin is cut off . . . ” Obviously, such an error would in fact make your electronic copy incomplete and could end up costing you if this results in violations. You need to make sure that you’re taking particular care to make sure that the duplicate electronic copy accurately reproduces the original.
If you’re keeping electronic records, these tips will help you stay in legal compliance. Keeping your system secure, backed up, and ensuring that you can produce records upon request – accurately and completely – will get you well on your way.
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Marc L. Jacuzzi, Esq., is a shareholder in the law firm of Simpson, Garrity, Innes & Jacuzzi. He advises clients regarding all aspects of the employer/employee relationship including hiring and termination, wage and hour requirements, employee classification, civil rights and discrimination issues, employee investigations, commission plans, employment contracts, employee handbooks and policies, confidential information agreements, reductions in force, leaves of absence, employment audits, M&A employment issues, violence in the workplace, and international employment issues.