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How Long Should You Keep HR Records?

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Serious legal trouble can result from destroying HR records that you should have held onto. However, holding onto them for too long is also frowned upon. Continue reading as we discuss how to know whether or not it’s okay to get rid of or keep certain records.

Destroying Paperwork too Soon

You may think that the paperwork is no longer necessary once an issue has been settled. However, you should always hold onto it in order to maintain statutory records–not doing so can result in fines. Not only will you save money, but properly maintaining your employment records will also come in handy should you ever face employment-related litigation. In the event of such a lawsuit, wrongful destruction of employment records can be seen as destruction of evidence.

Properly Disposing of HR Paperwork

As an employer, you are responsible for protecting everyone’s records from identity theft. Because of this, simply recycling old files is not an option. Most states mandate that you comply with confidentiality laws and log exactly what records were destroyed, when, and how. 

We suggest outlining a policy for the disposal of employment information in your employee handbooks. Both federal and state laws require you to keep records for a certain amount of time. You should keep your records for a minimum of three years (as required by federal law), and if your state law requires that you hold onto them for longer, go with this number instead. 

Keeping HR Documents for too Long

How do you know which paperwork you should hang onto, and which to ditch? Here are a few things to note when it comes to deciding on whether or not to destroy certain documents:

  • Public relations and sentimental value does not matter when it comes to documents.
  • Records should only be stored for archival, operational, or legal reasons–never “just in case.”
  • Temporary, unscheduled materials like reminders, worksheets, and drafts are okay to discard.

It’s important to be aware of the state and federal regulations, industry best practices, and local statutes of limitations when it comes to retention procedures. State retention statutes vary greatly depending on multiple factors, so be sure to check your local guidelines and speak with your attorney and accounting office when deciding on the proper length of time to keep your documents. 

Below is a list of common HR documents along with a recommended length of time to keep each:

  • Employee contracts – seven years
  • Employee & group insurance records – six years
  • Sick benefits & disability records – four years
  • 1-9 forms – no more than three years post-termination
  • Hiring paperwork – 2 years post-hire
  • Personnel earning paperwork – indefinitely
  • Disciplinary actions – recommended at 3 years post termination
  • Performance improvement plans – recommended at 3 years post termination

For a complete list of laws and regulations for record retention, you can check out our complete guide here. We know that disposing of HR related paperwork is no easy task. The last thing you want is more liability to worry about. If you’re still unsure of what to ditch and what to hang onto, contact Delta Administrative Services. As a Professional Employer Organization, we act as the personal HR department for small business owners, helping you to stay compliant and reduce your risk. Let us help you remove your liability today!

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