How important is it to keep accurate employment records? Not very, some might say, but they’d change their tune as soon as the lawsuits start to fly. Two experts tell what to keep, and where and how long to keep it.
Poor or missing records make it hard to defend lawsuits, says attorney Allen Kato. But if you have good records supporting your actions, opposing attorneys will be less likely to take the case. And even if they do, your records can defeat—or at least blunt—their efforts. Kato is an associate at Fenwick and West in San Francisco. He was joined at a recent BLR audio conference by fellow attorney Trey Wichmann.
Hiring Records
Responsible recordkeeping begins early in the hiring process, says Wichmann. He offers the following tips:
- Job descriptions. Be sure that your job descriptions identify the essential functions of the job, as required by the Americans with Disabilities Act (ADA), and that they describe the minimum qualifications applicants need.
- Job postings and ads. Avoid any limitation or exclusion on any protected basis.
- Job applications should include the following:
- Employment-at-will language
- Statement of truth
- Authorization to check references
- Arbitration agreement, if desired
- Interview notes. Document valid reasons for selecting and rejecting each applicant. Be sure that your notes are legible.
- Offer letters. Establish the terms and conditions of employment and confirm the at-will status of the relationship.
When lawsuits are filed, will your electronic records stand up in court? The easier way to find out: BLR’s June 3 audioconference, Electronic Recordkeeping: What To Keep, What to Toss, What to Scan, and Where to Store It. Satisfaction assured. Can’t attend? Preorder the CD. Click for full info.
- Reference and background checks. In general, says Wichmann, there are no legal hoops for employers doing their own reference checks with past employers. However, when doing criminal background checks through third parties, you fall under the Fair Credit Reporting Act. FCRA has a series of disclosures, consents, and notices—all with tight deadlines—that must be carefully tracked and maintained, especially if you take adverse action based on the report you obtain.
- I-9 verification. Make a copy of the documents offered, although this is not required.
- Drug and alcohol tests. The ADA and state disability and privacy laws require careful records be kept of the testing.
- Agreements. At hire, obtain signed statements concerning, as needed: invention assignment, proprietary information, noncompete, and employee handbook receipt.
Recordkeeping on the back burner? You’re going to pay the price eventually. Find out how to do it right at BLR’s June 3 audioconference, Electronic Recordkeeping: What to Keep, What to Toss, What to Scan, and Where to Store It. Can’t attend? Preorder the CD. Click for info.
What the Employee File Should Contain
Put in awards, performance appraisals, leave and absence records, discipline records, acknowledgement of handbook receipt, and training records, especially for training required by law. And to maintain credibility, Wichmann says, employers should include both negative and positive information.
Other types of records for the file include:
–Payroll and compensation. Be aware of what state and federal laws require.
–Benefits. Include plan-related records, notifications, and employee benefit records.
–Medical records. Keep medical records in a separate, locked file with limited access. This file may also include FMLA leave records. (See below for more on FMLA.)
–ADA. The ADA requires an interactive process for discussing reasonable accommodation, and you must have records that this interactive discussion took place.
–Workers’ compensation. Work-related injuries generate a series of documents for your files.
–OSHA. You may generate records of toxic exposure or hearing tests, for example.
–FMLA. The Family and Medical Leave Act triggers recordkeeping requirements that include strictly timed notices and responses. Be especially careful to track and document the use of intermittent leave, says Kato.
–Time off. Vacation, sick time, and other time-off records must be painstakingly maintained.
–Promotions. This is one area in which employers often get lax. Who’s going to file a lawsuit over a promotion, they say? But it’s not the promoted employee who files the suit, says Kato, it’s the one who didn’t get the promotion. Be sure to fully document your reasons for selecting the employee for the promotion.
–Discipline. Progressive discipline records are particularly important, because they are hard to challenge.
Retention
Kato suggested that instead of trying to master the varied retention requirements of the many federal and state HR regulations, just keep all records for 5 years after termination. That will be long enough for virtually all types of records, with two exceptions:
1. Pension and welfare benefits records should be kept for 6 years.
2. Safety and toxic exposure records should be kept for 30 years after termination.
In the next Advisor, we’ll offer tips on termination records and litigation relating to records, and an introduction to an upcoming audio conference that will answer your specific recordkeeping questions.