Setting the Records Straight

By Diane Cadrain Jun 1, 2007
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HR Magazine, June 2007Employee requests to see personnel records often signal that litigation is ahead.

When employees request to see their personnel files, “usually it’s bad news,” according to Timothy Loudon, an employment attorney with Berens & Tate in Omaha, Neb.

“The most common situation arises when there’s some conflict,” adds Sue Willman, an employment attorney with Spencer Fane Britt & Browne LLP in Kansas City, Mo.

In many states, statutes set the rules governing employers’ obligations to let employees see their files. That’s why it makes sense for HR professionals to have a firm grasp on the rules for employee access to their files.

Willman recommends that HR managers use a three-part filing system and designate documents as green, yellow or red. Access generally would be unrestricted to employees and supervisors for green documents. Employees would be barred from seeing yellow documents, but supervisors and managers could access them on a controlled, need-to-know basis.

Then there are the red documents. Some documents would be designated red to substantially restrict access to them by employees and supervisors.

However, “even in states with no law, it’s often in the employer’s interest to produce documents” when an employee requests them, Willman says. “If you’re convinced that you have a good defense, it’s better to produce them early on—that way, you can defuse a lawsuit.”

The first step, though, is to “understand what the obligations are in your state,” notes Joe Beachboard, an attorney with Ogletree Deakins in Los Angeles.

State Laws on Files

Most disputes over employees’ access to their personnel files “arise because employers aren’t aware of the rules, and they think, ‘these are our records, they’re ours to do with as we please,’ ” Beachboard says.

“That may be a reasonable approach,” he continues. “But if there’s state law on the issue, it’s not the approach you should take. Once you know the rules, you can work within them.”

Thirty-five states and the District of Columbia have laws governing employee access to employer files.

Only Georgia, Indiana, Kansas, Mississippi, Missouri, Montana, New Jersey, New Hampshire, New York, Oklahoma, South Carolina, South Dakota, Tennessee, Texas and West Virginia have little or no legislation on the issue. But even in those states, there may be separate statutes applying in limited situations.

In Missouri, for example, employees have the right to see records of their workers’ comp claims; in Arizona, drug testing results. That’s why HR’s first response should be to find out what’s legally required, which varies widely from state to state. (For a comparison of some state laws, see “Varying Scope of State Coverage,” at right.)

In states where the rules are highly developed and regulated, there may be a number of theories of liability. In California, for example, Labor Code Section 1198.5 gives current and former employees the right to inspect records of their own performance or grievances, subject to specifically enumerated exclusions.

Labor Code Section 432 requires employers to give employees or applicants, on request, a copy of anything the employee may have signed regarding the job. Section 226(b) requires them to allow both current and former employees to inspect or copy their own payroll records. Section 6408(d) requires them to allow access to records of exposure to toxic or harmful agents.

An employer that refuses to grant access may be charged with a misdemeanor and may also face a private action by the employee. The Division of Labor Standards Enforcement enforces the law.

“We have some pretty strong tools for protecting employees in California,” acknowledges Dan Bartley, a plaintiffs’ attorney in Novato, Calif.

Many other states with laws on the books also provide an administrative mechanism for investigating and enforcing complaints. In Wisconsin, enforcement is through the Department of Workforce Development; in Illinois, through the Department of Labor. In Massachusetts, the attorney general enforces the law and may levy fines of up to $2,500. It’s wise for HR professionals to be aware of and understand the enforcement mechanism in their states, even though these sanctions are seldom used.

Daniel Cornet, manager of the Santa Barbara Wage Claim Office of the California Division of Labor Standards Enforcement, says, “In my office, we usually call the employer or write them a letter explaining the law and requesting their voluntary compliance. This is usually sufficient. For recalcitrant employers, we issue an Order to Appear requiring the employer to bring the personnel file to our office.”

So What Should HR Do?

“Failure to provide access might make you the target of a lawsuit to compel you to produce documents,” Willman says. “It might also cause morale problems in current employees or lead to negative publicity.”

Employers should therefore think long and hard before refusing access. “If you refuse, the employee might decide to go ahead with a legal claim, such as discrimination or wrongful discharge, and that will force your company into another, more expensive arena,” Loudon points out.

Also, “You really shouldn’t have anything in the file that the employee hasn’t seen and signed, especially performance reviews or documents about formal disciplinary action,” Loudon adds. “If you’ve done a good job of maintaining the file and the material in there is legally defensible, why wouldn’t you grant access? You just need to have guidelines.”

In developing employee access policies in states where state law is silent, companies should consider factors such as:

  • Frequency of access.
  • Whether to allow copying.
  • Whether the review will be supervised.
  • Whether to allow access to current employees only or to both current and former employees.
  • How to provide access when files are in electronic form.

‘Traffic Light’ Filing System

Willman recommends using a three-part filing system and designating documents as green (unrestricted access), yellow (restricted to supervisors as needed) or red (most restricted access). Employers in states that have laws regarding employee access to files should make sure that this filing system complies with the requirements of those laws. Willman gives the following examples of the contents of green, yellow and red documents.

Green—Official personnel file:

  • Employment application and/or resume.
  • Special licenses and certifications.
  • Orientation checklist.
  • Equipment and property check-out forms.
  • Receipts for handbook and other policies.
  • Training records.
  • Performance appraisals.
  • Compensation adjustment forms.
  • Job status change forms and related information.
  • Disciplinary records.
  • Commendations, awards and other evidence of specific accomplishments.

Yellow—Confidential file:

  • Employment references.
  • Background investigation reports.
  • Criminal history reports.
  • Pre-employment screening tests.
  • Interview notes.
  • I-9 forms.
  • Benefits enrollment forms and related documents.
  • Tax forms (W-4, etc.).
  • Data collection forms on gender, race/ethnic origin, military status and disability.
  • Attendance records.
  • Internal and external investigation files of complaints by or against the employee.
  • Supervisory notes and correspondence.
  • Exit interview forms and notes.

Red—Restricted file:

  • Medical history questionnaires.
  • Medical evaluations and related documents.
  • Notes from doctors.
  • Requests for Family and Medical Leave Act (FMLA) leave and related documents.
  • Requests for Americans with Disabilities Act (ADA) accommodations and related documents.
  • Workers’ compensation history, claims and related documents.
  • Results of drug/alcohol tests and related documents.
  • Any documents about past or present health, medical condition, or disabilities.

Medical files should be kept in the red file but also carry special rules of their own. The ADA states that information from medical exams is confidential and must be maintained separately. Access is limited to the employee’s supervisors and managers, safety workers, and the workers’ compensation or other insurance carrier. Supervisors and managers, for example, may be informed of necessary restrictions on work, and first aid and safety personnel may also need to be appropriately informed. Similarly, the FMLA requires that employees’ medical records, and those of their family members, be kept in separate, secure locations.

Loudon advises defining a “medical record” as anything related to a medical condition, workers’ compensation or a condition requiring leave.

Request May Signal Trouble

Employee requests to see personnel files may be uncommon, but when they do surface it often is a sign that trouble may be ahead. Although there are plenty of harmless reasons for such a request, such as the need to get copies of good evaluations to show prospective employers, or to show dates of employment for purposes of applying for a loan, those situations are the exception.

“It’s usually because an employee believes he was treated unfairly,” Beachboard says. “They may have been denied a pay raise or a promotion, or been assigned an unfavorable job duty.”

Employers should be aware that a request to see personnel records under some state laws may encompass supervisors’ own personal files on employees. “It’s very, very common for supervisors to keep their own files,” Loudon says. “They want to be able to remember things at performance evaluation time.”

Loudon recommends training supervisors on how to document performance and how to keep those records in a manner that’s legal.

“Never put anything in writing that you don’t want read to a jury,” Bartley comments. “A lot of managers put information in ‘personal’ files, but that doesn’t work” in restricting access, Bartley cautions.

In California, a person has a right to see “personnel records that the employer maintains relating to the employee’s performance or to any grievance concerning the employee,” but not records relating to the investigation of a possible criminal offense, letters of reference, and ratings, reports or records obtained prior to employment or in connection with a promotional exam. “Employees have the right to see records regardless of whether the file is labeled ‘personnel file,’ ” Bartley observes.

The same is true in Wisconsin, says Daniel Kaplan, an attorney with Foley & Lardner in Madison, Wis. “The term ‘personnel file’ does include supervisors’ notes. Employers have to ask supervisors for their files, and they have to be included.”

“Statutes in each state are so different,” observes Susan Fentin, an employment attorney with Skoler, Abbott & Presser in Springfield, Mass. “In some states employees have absolutely no rights to their files, as the files are the property of the employer. But in other states—Massachusetts, for example—any piece of paper that you would review in order to make a decision about the employee’s employment is considered part of the file” and the employee must be granted access to it.

“That wide variation leads to two results,” Fentin concludes. “One: Employers with multiple facilities in different states have a hard time being consistent. And two: If your supervisors don’t understand the rules in the states in which you have operations, you’ll be in big trouble.”

Diane Cadrain is an attorney who has been writing about employment law issues for over 20 years. She is a member of the Human Resource Association of Central Connecticut.

Web Extras

SHRM white papers:
Maintenance of Personnel Files and Records

Safeguarding HR Records

SHRM toolkit:
Personnel Records

SHRM Solutions: 

Managers' Personnel Files Present Risks

SHRM video:
Manesh Rath, an attorney with Keller and Heckman LLP, discusses personnel records

Web site:
California Division of Labor Standards Enforcement

Varying Scope of State Coverage

State statutes are so dissimilar that it’s essential for HR managers to check the laws in their own states. Examples of some variations in the rules include:

Who is a covered employer? Twenty state laws apply to all employers, public and private. In 16 states, the rules are much more limited in scope. Some of those apply only to public employers as a whole, or to some subset of public employers, such as schools. Massachusetts draws a distinction between employers of 20 or more and employers of under 20.

Which employees are covered? The laws vary widely on whether the right of inspection extends to current employees, former employees or both. In Alaska and California, the law applies to both. In Illinois, the right of inspection applies to current employees, those subject to recall after layoff or leave of absence, and those who left the job within the preceding year. In Nevada, current employees may view their files, but former employees may do so only within 60 days of termination.

What materials are available for viewing? In Colorado, on request, private employers must make available any written information provided to a prospective employer about a current or former employee. In Louisiana, all employees may see medical reports in connection with employment. In Maine, a personnel file includes any formal or informal employee evaluations and reports relating to the employee’s character, credit, work habits, compensation and benefits, and nonprivileged medical records.

What material may not be viewed? In California, employees may not have access to employment references or records of criminal inquiries. Nevada bars access to confidential reports from previous employers or investigative agencies, other confidential investigative files, and information about criminal investigations. Many states also protect job references.

When must the inspection take place? Most states require inspections to take place under reasonable rules and during regular business hours. Some states, such as Illinois and Wisconsin, mandate that the inspection take place within a specified number of days of an employee request. Other states, such as Pennsylvania, allow employers to require that inspections take place only within employees’ free time.

How often is inspection allowed? Some states limit the frequency with which employees may see their files. Rhode Island allows inspections no more than three times in a calendar year, Connecticut and Illinois twice in a calendar year, and Pennsylvania once.

Is an employee allowed to rebut information in the file? Many states—including Connecticut, Delaware, Illinois, Massachusetts, Michigan, Minnesota and Wisconsin—allow employees who disagree with information in their files to talk to the employer about removal or correction. If the parties can’t agree, then employees are allowed to insert written statements explaining their positions and the statement becomes part of the file.

What are the penalties for violating the law? In Wisconsin, an employer may have to pay a penalty of $10 to $100 per day for every day of refusal. In Maine, the potential penalty is a civil fine of $25 for each day of refusal, subject to a cap of $500. And employees, former employees and the Department of Labor all have the right to sue the employer in court for “necessary and proper” relief, including costs and attorneys’ fees.

—Diane Cadrain

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