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Legal guidelines and tips for an electronic HR department
Although electronic storage of personnel records is permissible under federal employment laws, employers must be mindful of the statutory rules relating to document retention periods and electronic storage systems to avoid legal pitfalls. If your company is considering implementing a paperless human resources department, read on for legal guidelines and tips to ensure a smooth transition.
Personnel Records and Application Materials
The Equal Employment Opportunity Commission (EEOC) requires that personnel and employment records be preserved for the following periods:
Some states have laws that govern retention periods for personnel files that differ from the EEOC regulations. Further, record retention periods may be longer if the employer has affirmative action obligations or is required by regulatory agencies to maintain records for a longer period of time.
Digitize Medical Records
Medical information—including documents related to a disability accommodation request or Family and Medical Leave Act (FMLA) request—must be kept confidential and separate from an employee’s basic personnel file. One way to address this concern is to house electronic medical data in its own separate database with its own separate access protocol.
The Americans with Disabilities Act (ADA) requires that covered employers keep all ADA-related files for at least one year from the date the file was created. The FMLA requires covered employers to keep FMLA-related files for at least three years. As a best practice, medical records of terminated employees should be retained for at least four years from the date of termination. Remember, medical records related to workers’ compensation claims have a different retention period.
The EEOC recommends that race and ethnicity identification forms be kept separate from an employee’s basic personnel file. Again, it may be prudent to house electronic race/ethnicity data in its own separate database with its own separate access protocol.
Because the Fair Labor Standards Act (FLSA) does not require a particular order or form of records, wage records may be maintained electronically. If records are stored electronically, records must be available for copying and transcription upon request by representatives of the Department of Labor, and reproductions must be clear and identifiable. The FLSA requires employers to keep payroll records for at least three years. Further, employers must keep all records (including wage rates, job evaluations, seniority and merit systems, and collective bargaining agreements) that explain the basis for paying different wages to employees of opposite sexes in the same establishment for at least two years. Please note that state wage laws (Arizona, for example) may require longer retention periods.
Records required by the Occupational Safety and Health Administration (OSHA) may be kept electronically provided the computer they are stored on can produce forms equivalent to OSHA’s forms when they are needed and the system meets specific regulatory requirements. Access to injury and illness records must be limited. When an authorized government representative asks for certain records (for example, an OSHA 300 Log which lists all injuries and illnesses at worksites), copies of the records must be provided within four business hours. Finally, X-rays must be preserved in their original state (for example, if X-rays were received as hard copies, then they must be retained in hard copy form).
The U.S. Citizenship and Immigration Services requires that electronic systems used for storing I-9 documentation have:
Paper copies of I-9 Forms do not have to be retained if stored electronically, provided the storage system complies with the latter standards. Employers must retain I-9 Forms for three years after the date employment begins or one year after the date the person’s employment is terminated, whichever is later. If you are an agricultural association, agricultural employer or farm labor contractor, you must retain the I-9 Form for three years after the date employment begins for people you recruit or refer for a fee.
Beware: Copies of I-9 Forms must be available on three days’ notice of inspection by U.S. Immigration and Customs Enforcement.
Employee Benefits Documents
The Employee Retirement Income Security Act (ERISA) has two record retention provisions, which apply to all ERISA employee benefit plans (retirement, health and welfare plans):
General Requirements for Electronic Storage Systems
The record maintenance requirements of federal employment laws are generally satisfied when using electronic media if:
Tips for Electronic Storage
Adapted from “Going Paperless? Legal Guidelines for Electronic Retention of Documents & Evidentiary Considerations,” co-presented by Tiffani L. McDonough and Michael Fagan for the Liberty Bell Chapter of ARMA International (April 2014) and Archive Systems (May 2014). Used with permission.
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