Personnel Files The holidays are over. It is time for making and keeping New Year’s Resolutions. Now is the perfect time to make sure all of your employee personnel files are up to date, appropriately stored and that your company is adhering to federal and state labor laws. Two of the largest concerns any company has are their customers and their employees. Both are needed to keep your company generating profits. The state of the economy no longer allows most employees to take their jobs for granted. Being thankful for one’s job was very high on the list of many holiday tributes. Employees can make or break the success of any company. Large or small, independently or OEM owned, part of taking care of business is taking care of the human relations side of your company. Larger companies usually have a separate department or personnel manager to handle the legal requirements of employee relations. Smaller companies are sometimes unaware of specific governmental requirements or they choose to ignore the importance of following professional hiring practices and other labor laws. If your company does not follow the rules, how can you expect your employees to follow your company’s policy and procedures? As you add, release and retain employees, accurate documentation is essential. Employment laws are governed by federal, state, county and local jurisdictions. It is important that you follow all appropriate labor laws for your location. Companies with multiple locations may have different requirements. It is always better to exceed the requirements of your jurisdictions than to play catch-up. When conflicting laws overlap, the law most advantageous to the employee takes precedence. Every company should have an updated, legal written Policy and Procedures Manual. This document states in writing the rules and regulations your company will adhere to and states the policies each employee must follow. It is the starting and ending point of all employee – employer expectations. Before the first paycheck is issued, every new employee should have read, agreed to and signed acknowledgement and acceptance of your company’s Policy and Procedures Manual. This signed acceptance is the beginning of the documented record keeping that is a permanent part of each employee’s personnel file. It is also imperative that each company keeps an ongoing employee file. Most documents can be electronically filed or you may have paper documentation. In either case, privacy and security of these documents are crucial. As 2010 begins, it is the perfect time to make sure your personnel files are up to date and ready for examination by any employee, Department of Labor Commissioner or judge. Included in each employee’s file should be the original resume, application or record of the original contact before employment. If you placed a help wanted ad, keep a copy of the original advertisement. Once an employment offer is ready to be made, always putting into writing the specific job offer. This should include job title, starting date, pay rate, work days and hours, allowable expenses, review date, potential raise available at review, bonus, commissions, lead fees and any other promises that were made prior to employment. A signed (by the new employee) copy of this job offer should be kept in the personnel file. Starting the employment relationship in a professional, organized manner will help set the proper tone of the working relationship. When making a job offer, have an allowable time-period for a new employee to begin working. This may include a specific starting date or a range of time may be allowed by stating that the employee ‘must start on or before’ a specific date. Your Policy and Procedures book should state your pay period, pay day, commission, bonus and expense pay periods, vacation, sick leave, insurance options, leave of absence criteria, disciplinary actions, company car or expense mileage criteria, etc. Labor laws require the employee to have the right to view their own personal file upon request. Nothing should be put in an employee’s file that you would not feel comfortable having displayed on a four-foot by four-foot screen in front of a judge and jury. Treat each employee’s personnel file as a professional, legal document because it is. If a memo is written in an inappropriate style, have it rewritten in a more business-like manner. Everything in the file should be dated and signed. The file should be kept in a safe and secure place. It should not be accessible by the general staff. Typical items that should be kept in each employee’s personnel file include but are not limited to: • Original resume and / or application • Hire letter or contract with detailed job offer • Copy of certified driving record (if job requires) • Copy of current driver’s license and auto insurance (if job requires) • Copies of all performance reviews • Signed acceptance to agreeing with the Policy and Procedures Manual • Signed updates of Policy and Procedures Manual • Signed (non) acceptance of insurance participation • Insurance beneficiary • Signed (non) acceptance of pension program • Federal (and state) tax withholding authorization W-4 • Jury duty attendance sheets • Attendance records • Any disciplinary records • Any report of on-the-job injuries • Accident reports • Salary history with promotions • Listed certifications, special awards • Signed and dated voluntary resignation form • Written documentation of termination (interview) Items that should NOT be put in an employee’s file include their federally required signed and documented I-9 form, any documental on workers compensation claims, accident and sexual harassment claims. Each must be kept in a separate file. Any unproven accusations or non-professional, derogatory items dealing with age, sex, race, gender, etc. should not be put in an employee file. If an employee refuses to sign a disciplinary report, the manager should make a note of the refusal and sign and date the form. Even verbal warnings should be documented on paper. The end of employment must be well documented. If an employee gives notice of their desire to voluntarily resign, GET IT IN WRITING. Have a Voluntary Resignation form ready to be filled in by any employee that gives you a verbal notice of their intention to quit. Keep the original and file it away. This signed form can save your company thousands of dollars of unwarranted unemployment compensation payments. If your company has a re-hire policy, a former employee re-applying for work can be quickly referenced. If you choose to provide a reference on a former employee to an inquiring potential employer, the employee file can be extremely valuable. Well-managed employee files can save you thousands of dollars in unemployment claims and help protect from fraudulent employee-originated law suits. A labor judge or commissioner appreciates a complete, organized employment history. Prejudicial information or non-professional comments should never be put in an employee file. Keep the file organized and professional. This file can become a legal document at any time. In addition to selling office equipment and services, your company is also in the business of legally employing people. The better your records, the better your chances will be of not having to deal with disgruntled employees, labor attorneys, frivolous law suits, unemployment compensation and labor boards. An ounce of prevention can be worth 10 pounds of cure. Ronelle Ingram, author of Service With A Smile, also teaches service seminars. She can be reached at ronellei@msn.com