If you are old enough to remember the introduction of the PC, you probably also remember that we were all promised a world with less paperwork as a result of adopting computer technology. Well, it hasn't worked out that way. You know this to be true if you work in HR and payroll. You are keeping just as many records, if not more, and many of them are still stored as paper documents.
A big reason we have not managed to shed as much paper as we had hoped is directly related to regulations. Employers are required to store certain information on their employees throughout the employment term, and then at least for a few years after said term. And because it takes paper documents to generate this information, that's what we save. File cabinets and storerooms are filled to overflowing with reams of paper.
Documents Employers Typically Store
Whether your office still relies on mostly paper documents or you have made a concerted effort to transition to digital as much as possible, there are certain documents your HR department stores for every employee. Document accumulation almost always begins with an employee’s application and resume. From these two documents are born the employee personnel file.
Into that file, we add:
Identity & Worker Eligibility – Federal law mandates employers obtain proof of identity and worker eligibility on all new hires. Generally, this can be in the form of a driver’s license, government issued photo ID, military ID, and so forth. Both are obtained as a condition of hire.
W-4 Forms – Federal law requires employers to withhold and report federal income taxes and FICA for all employees. As a result, employees fill out W-4 forms at the beginning of their employment term that must be kept on file.
Benefits Forms – Employers who offer their workers benefits use a variety of paper and electronic forms to collect the necessary information. Those are also stored in the employee's personnel file.
Performance Evaluations – Next on the list are copies of performance evaluations. Whether a company performs evaluations annually, quarterly, or monthly, records are kept for the protection of both the employer and employee.
Reprimands – Records of employee reprimands should also be kept in a worker's personnel file. The information in such records may be necessary in the event of litigation.
Termination Documents – Finally, employers generate several documents upon an employee's termination. These may consist of disciplinary documents, records of exit interviews, COBRA documents, and so forth.
Time and Attendance Records
Employers are required by law to keep diligent time and attendance records in addition to personnel records. Time and attendance records are part of the Fair Labor Standards Act (FLSA) for purposes of making sure employees are paid every penny they earn. These records are absolutely critical whether they are stored as paper or digital records.
According to federal regulations, time and attendance record keeping must include employee identification information, the time and day the employee's official workweek begins, the hours worked each day, the total hours worked each week, the employee's regular pay rate, regular and overtime earnings, and a whole lot more.
Employees must retain time and attendance records three years at the very least. Records pertaining to how time and attendance were computed must be retained for at least two years. These records would include things like written timesheets or punch cards.
The computer age was supposed to save us from a mountain of paper. It has not. For some employers that means continuing to keep payroll and HR records in the storeroom.