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For the Record: Best Practices for Maintaining Personnel Records and Employee Files

5/24/23

filing cabinet

By: Janet Barringer and Ryan Giggi

Our increasingly digitized world has changed the way employers manage and keep records.  Personnel files are very frequently at the center of employment litigation, as a well-kept personnel file will tell the story of an employee’s performance, relationships with others, timely receipt of wages, an employer’s efforts to reasonably accommodate a disclosed disability, and more.  Further, in many states, employees have a right to view their personnel file on demand and to receive notice of adverse information within it.  Simply put, a complete and well-kept personnel file is essential to an employer’s defense of any employment-related claim. 

With this in mind, the following are some tips and best practices for employers in maintaining complete, pristine, and useful personnel files in a fast-evolving world. 

Mind the Statutes 

Review the specific state statute, if any, governing personnel files for where the company has a footprint. States frequently have statutes defining personnel records and content related to an employee’s file.  For example, while Massachusetts defines personnel records rather broadly, California requires employers to retain (and give to their employees) copies of any document the employee signed to obtain or retain their employment.  In further contrast, in Texas and Georgia, employees (other than those who work for a governmental employer) are not entitled to view their personnel files.   

In short, Employers should look up their state’s personnel records statute and be familiar with its contents. 

Clear Out the Closet 

Digitized systems for payroll, human resources, and the like have frequently resulted in fragmented personnel files, as older documents in a personnel file can be slow to make their way into a digitized system (or from one system to another).  This should be a priority.  Set some time aside to clear your closets and file cabinets of old personnel files, and make sure hard copy documents are scanned into your digitized systems; these older documents, particularly performance evaluations and records of discipline, are still relevant to that individual’s employment and should be easily accessible in case you need to justify that employee’s termination, demotion, discipline, or the like.  The more you can keep everything in one place, the easier it will be to care for your organization’s personnel files. 

Who Is In Charge? 

Employers periodically run into problems when different aspects of an employee’s file are kept or managed by different individuals.  When an employee’s complete personnel file is needed on short notice, it can be difficult to piece together fragments from multiple sources.  Your organization would benefit by designating at least one particular individual to manage personnel files, thereby assuring that at least one individual knows where everything is and can gather it quickly if needed.   

When In Doubt, Document! 

Even in at-will states, judges and juries expect to see documentation justifying the treatment of an employee.  Things as significant as performance evaluations and written discipline to as innocuous as informal coaching sessions about performance can be relevant and significant if you run into litigation or other unanticipated problems with that employee.  So, document, document, document!  You protect yourself and your organization by drafting a quick memo concerning a noteworthy event with an employee to include in a personnel file. 

Communications are Key. 

Finally, email and text communications can be incredibly important in telling the story of an individual’s employment in litigation – not just the employee’s own electronic communications, but communications among their supervisors discussing that employee.  If an employee is discussed by email in any significant way, make sure that email is filed away in a manner that allows you to find it later.  To be sure, certain communications about an employee – particularly privileged communications with your employment lawyer or in-house counsel – are not contemporaneously placed in a personnel file.  However, these documents can be hugely significant later on, and an organization can suffer if they are lost or not easily retrievable.  So, make a separate folder in your email account for significant communications concerning employees and be sure to update it as needed. 

Please contact Janet Barringer (janet.barringer@fmglaw.com), Ryan Giggi (ryan.giggi@fmglaw.com), or your local FMG attorney for more information.