How long should my business keep employee files for?


If you’re storing ex-employee files from the last millennia, you may be hanging on to them for just a bit too long. While the law requires employers to hold on to certain files for certain periods of time, the employee business files won’t be much use to you after that. Of course, you could always hold onto files for longer to be safe in the event that a lawsuit arises against you, but that is for you to determine. 

So let’s take a quick look at different types of employee files and figure out how long you should store them. Perhaps you’ll be able to free up some space in your filing cabinets after all!

Applicant and Hiring Records

During the recruitment process for a new hire, you’ll collect a lot of information such as resumes, cover letters, CVs, interview notes, as well as your job postings. Should anyone question your hiring decision, you’ll want to have this information on hand for at least a year after the hiring date. 

Storing these records could come in handy if there is a discrimination case against you. You’ll also be in compliance with the Americans with Disabilities Act and Title VII.

Payroll Records

Payroll records for employees business can be discarded five years after an employee leaves the company. Any longer than that and the data will be too old for anyone concerned with audits. The law only requires you to keep this data for three years, but recent lawsuits show that it is prudent to keep it for at least five.

Track every hour worked for each employee and how much they were paid for their time. Keep records of paid time off, maternity pay, as well as any disability records you may have on hand. 

Using a pay stub creator will enable you to easily store these records. You should keep any W2 forms and 1099 forms for at least five years as well.

Health and Pension Benefits Records

Keep all records for all of your plans for a minimum of six years. If an employee business sues you saying that you owe them a higher pension, the courts have shown that it’s the employer’s responsibility to prove they do not owe more, not the other way around. 

Keep records for employees who are eligible for COBRA, just to be safe. These records can be kept with the rest of your employee records in their personnel file.  

So, How Long Should You Keep Employee Files?

The law requires different lengths of time for different types of files, which we have outlined here. You may want to keep employee files longer than the law states to be on the safe side, but that is your decision to make. The use of an offsite data management system may help you in safely storing employee records for the required length of time. 

If you found this article helpful, check out the rest of our blog for more interesting posts. 

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