Personnel files are some of the most important files in any organization. It’s critical to make sure that you have what you need to prove that employees are legally allowed to work and to ensure that you’re taking proper steps when it comes to things like taxes and insurance requirements. If you decide to terminate an employee, it may also become critical to show documentation supporting behavioral or performance issues.

On the other side of the equation, however, it’s also important to limit the amount of data stored in employee files. The more data that you store in employee files, the greater the amount of sensitive information that could potentially be compromised. It can be helpful to have a guideline as to what should and should not be kept in an employee personnel file.

What to Store in Employee Files

Employee file folders can be divided into several sections: employment personnel file, confidential, benefits, and payroll. Depending on the employee, more categories may become necessary. Dividing the documents in the employee filing between different folders can help avoid accidental exposure of confidential information. It’s important to differentiate between the personnel file and what documents should not be kept in a personnel file.

Employee Personnel File

The employee’s personnel file can include documents such as:

  • Recruiting/screening documents:
    • Application
    • Resume/CV
    • Transcripts
  • Job description
  • Any records related to:
    • Job offers
    • Promotions or demotions
    • Transfers
    • Layoffs
  • Employee handbook/policy acknowledgments
  • Training and education records
  • Compensation and pay information
  • Awards and letters of recognition
  • Performance evaluations
  • Noncompete/confidentiality/other agreements
  • Warnings/disciplinary notices
  • Termination of employment notice
  • Exit interview documentation

Confidential File

The confidential employee file should include documents containing sensitive or confidential information. Keeping such documentation within a separate file or folder will help you avoid the accidental disclosure of the information contained within. These documents can include:

  • References
  • Background check results
  • EEO and affirmative action forms
  • Drug test results
  • Litigation/legal documents
  • Child support or wage garnishments
  • Records of workplace investigations
  • Employment/payroll verification requests

Benefits File

Benefits information and forms should be kept in their own file folder. Benefits enrollment comes up annually, so it’s a good idea to have all of the relevant information handy in its own folder. These benefits forms can include:

  • Benefits enrollment forms
  • Designated beneficiary forms

Payroll File

The payroll file should include all records related to payroll, including:

  • Pay authorization
  • W-4 forms
  • Timesheets and attendance records
  • W-2 forms
  • Pay raises
  • Payroll deductions
  • Reimbursements
  • Advanced pay requests
  • Awards and bonuses

Optional Files

Forms like I-9s, hazard communication training logs, medical records, workers’ compensation claims, investigation records, and garnishment records may need to be accessed by third parties. Tying these documents to employees’ personal files could allow sensitive information to be accessed. Storing them separately keeps this information safe while allowing the appropriate parties to access specific data.

Medical File

A separate medical folder can be used to store any files relating to employee medical records. The ADA actually prohibits employers from storing medical files in employees’ general personnel file folders. These medical forms can include:

  • Medical questionnaires
  • Benefits claims
  • Medical leave records
  • FMLA requests
  • Doctor’s notes
  • Worker’s compensation claims
  • Accommodations requests
  • Emergency contacts

I-9 Forms

I-9 immigration forms shouldn’t be kept in the employees’ general personnel file folder. If this form is kept by an employer, it needs to be stored separately from the employee’s other records.

What Not to Store

Information about employees’ personal lives shouldn’t be stored in their files. Some irrelevant information that has been found in employee files includes hobbies, political affiliation, religion, and number of children. With the addition of social media analysis to some recruitment strategies, employee’s social media site addresses are another thing that should be purged from employee files if they have been stored.

While notes about performance should be kept on file, employers should be careful to stick to the facts. Employees can request to see their files and files may be reviewed by legal counsel or a jury if a lawsuit is filed. Writing notes that could be considered discriminatory or inappropriate could be harmful to an employer in these situations.

How Long Should You Keep Employee Files?

Companies are legally required to keep employee records for a certain period of time, even after they’re no longer employed by your company. Exactly how long depends on where your company is located. The time period can vary depending on the state, so it’s important to research all legislation regarding keeping records. It may be a good idea to keep employee files perpetually, in case they’re needed, such as for employment verification.

Should Files Be Stored Digitally?

Paper files are, in general, a thing of the past. Modern HR software can store all documents digitally. Even if you choose to keep paper backups, all files should also be stored digitally. This makes it easier to find and sort employee records. Employee filing is a lot easier for HR professionals to manage and for employees to access when it’s done digitally.

Cleaning up employee files and making sure that only the most relevant and up to date information is stored can improve security and protect employers. Using a HRIS can make it easy to store employee information correctly and securely. If you would like help finding a HRIS that’s the right fit for your company, visit our vendor match page to get started.