Many people might pass up this blog post up because the topic is not very snazzy and employee files are not at the top of the “must do food chain” but here are few facts that you should be keep in mind.
Recently, Elizabeth was working with a client when the topic of employee files came up in their discussion. The client, a business owner with only a few employees wasn’t really sure what she should have and what she must have in her employee files.
The conversation sparked Elizabeth to start her own ‘need to know’ facts that all employers should know about forms and employee files:
- Did you know that every employee working in the USA MUST complete an I-9 Form?
The USCIS Employment Eligibility Verification form is a required document that verifies the identity and employment authorization of each new employee you hire. You should also know that you are required to keep a copy of the Form I-9 and be able to produce it in the event of audit. It’s recommended that all completed Form I-9s be kept in a in a file separate from the employee’s personnel file.
- Did you know that the USCIS frequently updates the form and using a outdated form for a new hire can result in a fine if you’re audited?You can locate the most current Form I-9 online at http://www.uscis.gov/sites/default/files/files/form/i-9.pdf.
- Did you know that employers MUST retain the original I-9 forms for a specific period of time after an employee leaves?Here’s the deal. You must keep the Form I-9 for one year after the employee terminates or for 3-years after the date of hire depending on which shows the longer period of time the employee was around Okay, what that means in common terms is: If the employee was with you for 3 or more years, you only need to keep the Form I-9 on file for one year after they leave. If they worked for you for three years or less, then you have to keep the Form I-9 until you get to that 3 year mark or one year after termination whichever is longest. Not too complicated one you the hang of it.If your employee is still employed or come back before the expiration of the “holding period”, you can just update the original form. (Or you can create a new one for rehires – that’s up to you.)
- Did you know that your I-9 forms may be inspected at any time!
Officials from the Department of Homeland Security’s USCIS, Department of Labor, IRS, DOJ, or just about any other government agency auditor can ask to inspect your Form I-9s. Normally you will receive written notice 3-days before inspection but that’s not always the case. the 3-day notice.
- Did you know you could get fined if your I-9 forms aren’t completed correctly?Yeah, that’s right. And the fines aren’t assessed just because you have undocumented workers. Just last month the Department of Labor fined an Atlanta based company $600, 000 for paperwork errors. So if ever there was a reason to make sure your “I’s were dotted and T’s crossed”, this would be it.
- So what about the other stuff that goes into an employee file?Well each type record can have a different retention period. At the end of the day, as long as you keep your payroll records in good order and for the statutorily required period of time you should be okay…but being able to produce the information in the event of lawsuit or on demand is key.
- What about confidential information or medical records?While there’s no law that says employee confidential information or medical records must be kept separate from the employee’s general employment documents like performance appraisals or counseling notices, its highly recommended that you keep them apart to avoid any hint of discrimination when making employment decisions.