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Personnel File Maintenance and Management

May 13, 2022

By Michael Burns, courtesy of SBAM Approved Partner ASE

ASE regularly receives member calls about personnel file management and maintenance. Let’s go over some basic information about record retention and personnel file management.

The size of an organization’s personnel file may vary depending on what documents the organization decides it will maintain. A count of typical personnel file documents found upwards of over 75 different personnel documents that may be kept.

Under Michigan’s Bullard-Plawecki Sunshine in the File law, the personnel file is defined very broadly to include any information that has been, or may be used to determine qualification for employment, promotion, transfer, additional compensation, or disciplinary action.

Michigan’s law permits an employee to inspect their personnel files upon written request up to twice per year at a location reasonably near the workplace and during normal business hours. The employee also has the right to obtain a copy of all or any part of the personnel file. The employer may charge a copying fee. The fee should be the actual cost of copy duplication.

Under this law there is certain information the employer has the right to exclude from the employee inspection when access to the file is requested. Excludable information includes identities or persons providing employment reference information, medical reports, and records the employer obtained that can also be acquired by the employee from their physician or medical facility, personal information about persons other than the employee if that information would be an unwarranted invasion of another person’s privacy, separately maintained employer investigation information into criminal activity, separately maintained grievance records that are not used for the defined employment purposes, education records protected by federal law as well as materials relating to staff planning involving other workers, including salary increase information, management bonus plans, promotions and job assignments to name a few exceptions.

One question that often comes up about managing the personnel file is whether a separate sub-file of the general personnel file should be set up for other sensitive information or documents. There should be at least two separate human resource personnel files for an employee. One for employment and performance related data and another for medical and other confidential information. That said, it is up to the employer as to how many separate files they must keep. Employers should keep the confidential information in a segregated/separate personnel file record for:

  • Pre-employment testing results and employment background check information
  • I-9 forms
  • Benefit plan information
  • Medical records
  • Health and Safety records
  • Social Security Number
  • Documents that identify employees by rage, sex, color and national origin
  • Discrimination Investigation files
  • Self-identified veterans and individuals with disabilities

Employers are advised to check for an applicable state law if they have operations in other states.

Personnel records have a shelf life. In other words, they should be kept and stored for a period of time. Under federal and state law, specific document retention periods vary by purpose of document. Other documents the employer deems important enough to keep may be kept for a time period pursuant to common law.

Below are some general record retention time periods employers may use to maintain personnel files. This is not a complete list of record retentions requirements. For a more detailed listing of record retention periods, ASE members are advised research this in our online CCH HR Answers Now library located in the ASE Member Dashboard.

Record retention policy should be set up pursuant to state, federal and common law legal compliance requirements. And don’t forget an organization may also be in an industry or does business with organizations that have its own recordkeeping requirement.

Termination + 3yrs.

  • Health and Benefits Records
  • Pre-employment/Employment Documents
  • I-9 Form

Termination + 4 yrs.

  •  401k Allocation Records
  • Request for 401k Calculation
  • Direct Deposit Records
  • Garnishment Records
  • Final Payroll Deduction Checklist

Termination + 5 yrs.

  • Job Related Injuries and Illness Records

Termination + 30 yrs.

  • Toxic and Bloodborne Pathogens Records. Most medical records as well. Subject to some exceptions.

Termination + 50 yrs.

  • Retirement Beneficiary Form

Payroll and Tax Documents can be purged regardless of employment status after four (4) years. This includes withholding, federal and state payroll tax forms, and time sheets/cards.

Organizations are advised to check for applicable state law if they have operations in other states.

Organizations should always be consistent in keeping personnel file records. What is kept for one employee should be kept for all.

Access to personnel files should be limited to only a single individual or department who is authorized.

As mentioned above, employment records are kept for a period of time due to state and federal requirements, but an organization may also need to decide if certain documents need to be maintained longer because of possible private lawsuits. This is a double-edged sword that it is advisable to talk to an organization’s legal counsel about. Keep documents too short of a time and they may not be available for an organization’s defense. Keep them too long and the document can end up being used against the business.

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