What’s the Best Advice about Employment Records?

Every New York employer needs to be sure it is ready to survive an Department of Labor audit or an employee lawsuit. You need to know that when the knock at the door is from a DOL auditor or the suit papers are handed to you by a process server, your records will stand up to scrutiny rather than being Exhibit ‘A’ against your company.

Why Should My Company Keep Payroll/Employment Records?

Employers often ask whether it is better to keep employment records or discard them regularly?

There are two parts to the answer to this question. First, every employer must keep employment records because the law requires it. Second, employment records (provided they are managed correctly) can be an employer’s best defense against employee claims.

ARE YOUR EMPLOYMENT RECORDS GOING TO BE EXHIBIT ‘A’ FOR YOU OR AGAINST YOU?

Every management side lawyer hopes to avoid the embarrassment of trying to support a company personnel decision only to find that the employee’s HR file doesn’t provide useful documentation, or worse, contains damaging material.

Here are some guidelines to follow and mistakes to avoid.

Mistake #1: Leaving out Details – put in the facts! The first and most important guideline is making sure all the pertinent details are mentioned in your writing. Leave out irrelevant and unsupportable statements!
Guideline: Include all the facts – there’s lot’s of room in computer files and paper is cheap.

Mistake #2: Being Too Wordy – the second guideline is don’t hide important information in a pile of useless words – this only ends up camouflaging the truly important details.
Guideline: Keep your memos as simple as you can – put in all the facts that pertain but be concise.

Mistake #3: Assuming – don’t assume the reader knows the background!  The third thing to keep in mind is that a reader needs to know context and your writing must tell the story which lead to the current situation or status.
Guideline: Give a short history with enough details so that if the memo is read as a stand alone document, it is understandable and supports management with the situation.

Mistake #4: Don’t use ‘As you know’ – forget about saying “as you know”, “as per our conversations”, or “remember what we talked about before”. These mean you’re leaving out something or skimping on the details!
Guideline: Avoid being vague and ambiguous – you don’t want to have your words left open to interpretation. Creating documentation that will stand up to inquiry means including details and important facts.

What Employee Records to Keep?

Keep these items for 6 years:

1. Specific records for each employee – wage payments, minimum wages, and hours worked, promotion and discipline, time sheets, wage rate tables, work and time schedules, records of additions to or deductions from wages, and documentation of the basis for payment of any wage difference to employees of different sexes.
2. Records required by federal and state laws – four years of accurate payroll records (number of employees working and the wages paid); personnel and/or employment records relating to (1) job applications, resumes, job advertisements, and records pertaining to failure or refusal to hire; (2) promotion, demotion, transfer, selection for training, layoff, recall, or discharge; and (3) job orders submitted to employment agencies or unions.
3. Updated employee files – basic payroll data, the dates and hours (note if less than full days) of FMLA leave taken, sick leave taken, vacation accrued/taken, copies of employer notices, documents describing employee leave benefits and policies, premium payment of employee benefits, and records of disputes with employees