What Employee Recordkeeping Do You Need to Keep?

Employee Recordkeeping requirements can be incredibly complex. With state and local governments setting all sorts of requirements for employee recordkeeping, it quickly becomes difficult remember what you need to keep. 

Almost all federal business law standards in the United States establish rules for collecting and keeping employee data. Beyond these requirements, many state and local governments might need your business to keep unique kinds of records for long periods of time. 

Today we will explore what the best practices are to comply with most common recordkeeping requirements, and see just how complicated recordkeeping can get. 

Basic Record Retention 

If your business is not particularly concerned about recordkeeping, there are some simple approaches to reduce liability.  

The simplest solution, if you aren’t concerned about secure data storage and archiving costs, is to keep all of your employee data for as long as each employee is employed, plus another five years

While there are a few notable exceptions, like records for pension and welfare benefit plans which require 6 years retention following employment, and records for safety and toxic chemical exposure, which require 30 years retention following employment, most records only need to be kept for five years after the employee is active. 

Advanced Record Retention 

While the simplest solution might work for some businesses, the best policies are usually the most inclusive policies.  

Storing as much employee data for as long as possible is a best practice. It minimizes the risk of your company being found liable for mishandled records, and keeping these records protects your business from expensive litigation. 

When you develop your recordkeeping policy, you can divide your records into three categories: 

  • Pre-employment records, such as records for non-hires and potential employees, should be held for a minimum of two years after receipt. 
  • Employee records, such as employee information and hours, should be held for as long as the employee is working for your company
  • Post-employment records, for any previous employees, should be held for a minimum of six years after employment ends. 

By keeping these records organized, you’ll be ready for anything. 

Employee Benefit Record Retention 

Not only do employee hours and positions need to be tracked. Your business is also responsible for tracking an employee’s benefit time, like vacation time and sick leave.  

Careful tracking of benefit time ensures that no one in your company is receiving unqualified benefits, which prevents claims of discrimination and unfair workplace practices. Additionally, some states require that business pay terminated employees for any unused vacation time. Having perfect accounts for employee benefit time is necessary recordkeeping. 

This also ties in to a requirement mentioned earlier; pension and retirement records need to be carefully tracked and held for at least six years after the employee leaves the company. If these records aren’t kept (or can’t be found when called for) your business could be violating the Employee Retirement Income Security Act. 

It is strongly recommended that your business keeps all records for medial and family leave, as well as workers compensation. These records should be kept in employee files indefinitely, as doing so ensures compliance with the Family and Medical Leave Act. 

The best way to ensure compliance is with an automated employee time and attendance system.

The Acumen Answer for Time and Attendance Record Retention 

Ultimately, the best way to ensure compliance is with truly automatic employee time and attendance tracking. With so many different requirements, and so much data to collect, organize, and retain, automation makes recordkeeping manageable for a business of any size. 

Fully featured time and attendance software will collect, store, and give you effortless access to employee records.  

Acumen is proud to provide workforce management solutions that are feature rich and easy to use. With ClockVIEW, you can automatically collect and maintain employee records in accordance with federal, state, and even local laws. 

Experts in Timekeeping and Employee Scheduling 

Acumen Data Systems is a leading provider of time clock and employee scheduling software. We help organizations manage their most valuable resources, the human kind. Acumen offers robust solutions for time and attendance, scheduling and leave management.

We believe that technology is just one quarter of the workforce management pie. Employees, policy, and the environment are just as important.

Do you have questions about Employee Recordkeeping?

Contact one of our experts to discuss the best timekeeping solutions for your organization. You can also reach us at 888-816-0933.