A Practical Guide to Personnel File Retention and Organization

Personnel File Organization and Retention: How To 

An organized and efficient personnel filing system is critical for creating a compliant and streamlined process to locate documents for relevant parties. The end of the year is a good time to organize and purge files in preparation for the new year.  

Begin by reviewing Catapult’s Record Retention Tool. You should keep the majority of employment documents relating to a current employee, but it is a best practice to periodically review the contents of the personnel file. You can shred individual time records that are over 3 years old. You can also purge general attendance notes, which no longer apply. For example, if an employee had a cold 5 years ago and brought you a note to excuse them from work for a couple of days, you can get rid of that note.  

Once an employee is terminated, you need to maintain the same separate files discussed below, but you can shred their individual personnel file seven years post-termination. Keep in mind, some information containing a medical diagnosis needs to be kept for 30 years post termination. See the Record Retention Tool for details.  

Due to regulations and best practices, employers should have three files on each employee. Additionally, there should be an I-9 folder that houses I-9s for all employees. I-9s can be stored alphabetically for current employees and then by retention date for terminated employees. All files should be kept under lock and key or password protected. Limit access to personnel files to HR staff, managers, and other authorized individuals only. Refer to the Employee Files Audit Tool to determine what type of documents go in which file.  

This is the main employee file and should contain all of the general employment documents. For ease of use, it can be divided into varying categories such as pre-employment, training, performance evaluations and compensation. Not only does this make it easy to find what you need but it makes it easy to remove certain sections if the employee’s manager needs to view the file.  

Per the Americans with Disabilities Act (ADA), all medical information must be kept in an entirely different folder from the personnel file. This includes doctor’s notes and leave of absence paperwork. Electronic medical files should also be kept separately and require an extra level of security, such as a different access level (i.e., limited to HR staff only) or password.  

If needed, a third confidential file should be maintained for housing documentation related to workplace investigations or EEOC activity and litigation.  

For electronic file storage and retention, start here by reviewing Catapult’s Paperless HR Files document.  

All of the requirements and methodology described above also apply to electronic files. It is recommended to use encrypted cloud storage, secure servers, or HR management software with role-based access controls. It’s also imperative to ensure regular backups occur. You will also want to consider if there are any automatic document destruction measures in place. What is the process for adjusting those should the need arise, for example, if there is litigation?  

Generally, employers are allowed to keep anything electronically. When designing your system, consider ease of use and how you will present documents if requested by a third party, such as the Department of Labor or the EEOC.  

Once you go electronic, Catapult recommends keeping your paper files for at least 9 months to a year. This way, you can ensure every document made its way into the electronic file and that it is set up the best way for the organization.  

If you have questions about organizing, maintaining, and retaining employee files, please contact a member of Catapult’s HR Advice team. Happy filing!