Little thought is given to personnel file management systems and often employee files are used as a catch-all, overflowing with documents that should be held elsewhere. Not only will this make it difficult for you to find documents when they are needed, but poorly managed personnel files can also cause legal issues.  Without the proper documentation, your company may be unable to justify legally-contested hiring decisions or disprove discrimination claims.

When setting up your personnel files, many things should be considered.  First and foremost, the files must be legally compliant.  If the information contains protected and non-job related information, it should not go in your basic personnel file.  Next, consider how many files or what type you will want set up for each hire.  Additional files must be created for I-9 compliance, employee medical information, payroll, EEO-1, or other information.

Determining What to Include in Your Personnel Files

Every personnel file should be viewed as a storehouse where the documents held within tell a story of the relationship of the employee and the employer.   To make the determination whether or not a document should be placed in an employee file, ask yourself these questions:

  1. Does the information contain protected or non-job related information?  If so, it should be filed separately from the personnel file.
  2. Is the information relevant to those making an employment decision?  If yes, then it should be held in the employee’s file.
  3. Is the information related to the employee’s performance?  If yes, then it also should be held in the personnel file.
  4. Do the documents relate to the termination of an employee?  If yes, then they should be in the employee’s personnel file.

Personnel File Do’s…

So, you may ask, what documentation should be included in a basic personnel file?  Below is a list that will help you as you establish your files:

  • Job descriptions
  • Signed policy acknowledgments and agreements or any other records relating to employment practices
  • Offer letter
  • Education and training records
  • Information pertaining to promotions, demotions, transfers or layoffs
  • Pay and compensation information
  • Employee performance evaluations
  • Letters of recognition or appreciation- formal and/or informal
  • Documentation of warnings, coaching, and disciplinary actions
  • Termination documentation

 

And don’ts…

Protected health information must never go in the personnel file, but maintained separately, away from the personnel files that are used to make employment decisions.  To protect the privacy of the employee, medical files should be locked up away from other files with access by only those that “need to know,” such as your benefits manager or HR Director.

Also, the I-9 form, required by law to verify the employment authorization of all workers hired after November 6, 1986 for employment in the United States, should not be held in individual employee files.  The I-9 form has information related to an employee’s national origin, immigration status, and other protected information.  A separate file or binder should be established to hold all I-9’s and accessible to those in the H.R. Department.

Here is a full list of what not to include in your personnel files:

  • EEO/invitation to self-identify disability
  • Notes taken during the interview process
  • Test results
  • Background checks
  • I-9 Forms
  • Any medical or insurance records.  These include benefit enrollment forms, benefit claims, doctor’s notes, accommodations requests and leave of absence requests
  • Child support and garnishments
  • Worker’s compensation Claims
  • Request for employment/payroll verifications

Remember that accurate files and a well thought out and compliant personnel file management system can reduce your potential liability and often play a significant role when defending an adverse employment decision or other employment action.