How Long to Keep Records?
Records are at the very core of what a human resources (HR) department does. As the managers of an organization’s most vital resource pool, HR professionals must maintain the records of every hiring, firing, and grievance.
HR is the backbone of a good corporate culture. An effective HR department will mean employees that feel looked after and a sense of trust in the management of the business. Properly managing the records of your employees is a huge part of establishing that trust.
For many businesses, the HR manager or department also manages payroll. So, on top of the personnel files and other records, they must also maintain records of employee earnings, invoices, and a host of other important documents come tax time. With so many varying record types and such a vital role in managing them, it is only natural that HR professionals would be constantly searching for more efficient ways to manage records. With that in mind, let’s take a look at what records retention and management means in the context of human resources.
What is a Human Resources (HR) Record?
There is no simple answer to the question of what, exactly, qualifies as an HR record. This is because the answer largely depends on how an organization is structured and how broad the purview is of the HR department. For some smaller businesses, the HR department may deal with almost all of the accounting and payroll records for the business. For larger organizations, they may play a more segmented role.
At their most fundamental level, HR records can be described as any record of the internal functioning of a business or organization. They are the memory of the organization, serving to ensure that failures are documented and learned from, that legal disputes can be resolved effectively, and ultimately that the business or institution can continue to build on a foundation of defined processes. A business with no memory is a shaky idea indeed.
Types of HR Records
While what is considered an HR record may differ from organization to organization, there are some fundamental categories of HR records that will be consistent across just about any business or industry. Here are a few of the most common examples.
Personnel files include everything that was generated and collected during the on-boarding process, including offer letters, signed contracts, copies of any signed employee handbooks etc., as well as any ongoing assessments of performance. These records are generally available to the HR manager and any superiors or managers of the employee.
Payroll files should be a record of any and all things related to an employee’s compensation or taxes. This includes direct deposit forms, filled out W2 or 1099 forms, W4 forms, time-off requests, and anything else that may need to be referred to in any wage disputes or questions about tax withholding.