Most small business owners dream of the day that they will be able to hire someone to help out.  You see this person coming into your organization and making life so much easier.  They come in early, stay late and know exactly what we want them to do before we say a word.

Ok, you know that’s not going to happen but it was nice to dream.  The reality of hiring employees means that we are now accountable to training and paying another person.  You should add to your reality checklist, the management of their confidential employee files which federal laws provides some instruction on what you can and cannot do with private information.

Part of being a professional business manager is keeping quality professional records. Take a look at your organization’s practices and find out if you have what you need. If not, plan to get it. It will save you trouble in the end.

The federal Health Insurance Portability and Accountability Act of 1996 (HIPAA) requires employers and health care providers to protect medical records as confidential, separate and apart from other business records. That means we may no longer retain medical information in a personnel file. Here are some examples of information you should extract from your personnel files and place in separately protected files as medical information:

  • Health insurance application form
  • Life insurance application form
  • Request for medical leave of absence regardless of reason
  • Personal accident reports
  • Workers’ compensation report of injury or illness
  • OSHA injury and illness reports
  • Any other form or document, which contains private medical information for a specific employee.

March Business Project: Audit Your Employee Files

RECOMMENDED CONTENTS OF PERSONNEL FILES

Employment

  • Request for application
  • Employee’s original employment application
  • Prescreening application notes
  • College recruiting interview report form
  • Employment interview report form
  • Education verification
  • Employment verification
  • Other background verification
  • Rejection letter
  • Employment offer letter
  • Employment agency agreement if hired through an agency
  • Employee Handbook acknowledgment form showing receipt of Handbook
  • Checklist from new employee orientation showing subjects covered
  • Veterans/Disabled self-identification form
  • Transfer requests
  • Relocation offer records
  • Relocation report
  • Security clearance status

Payroll

  • W-4 Form
  • Weekly time sheets
  • Individual attendance record
  • Pay advance request record
  • Garnishment orders and records
  • Authorization for release of private information
  • Authorization for all other payroll actions

Performance Appraisals

  • New employee progress reports
  • Performance appraisal forms
  • Performance improvement program records

Training and Development

  • Training history records
  • Training program applications/requests
  • Skills inventory questionnaire
  • Training evaluation forms
  • In-house training notification letters
  • Training expense reimbursement records

Employee Separations

  • Exit interview form
  • Final employee performance appraisal
  • Exit interviewer’s comment form
  • Record of documents given with final paycheck

Benefits

  • Emergency Contact Form
  • Medical/Dental/Vision coverage waiver/drop form
  • Vacation accrual/taken form
  • Request for non-medical leave of absence
  • Retirement application
  • Payroll deduction authorizations
  • COBRA notification/election
  • Hazardous substance notification and or reports
  • Tuition reimbursement application and or payment records
  • Employer concession and or discount authorization
  • Annual benefits statement acknowledgment
  • Safety training/meeting attendance/summary forms

Wage/Salary Administration

  • Job description form
  • Job analysis questionnaire
  • Payroll authorization form
  • Fair Labor Standards Act exemption test
  • Compensation history record
  • Compensation recommendations
  • Notification of wage and or salary increase/decrease

Employee Relations

  • Report of coaching/counseling session
  • Employee Assistance Program consent form
  • Commendations
  • Employee written warning notice
  • Completed employee suggestion forms
  • Suggestion status reports

WHAT SHOULD NOT BE IN A PERSONNEL FILE

Medical Records

  • Physician records of examination
  • Diagnostic records
  • Laboratory test records
  • Drug screening records
  • Any of the records listed above in the discussion on HIPAA
  • Any other medical records with personally identifiable information about individual employees

Investigation Records

  • Discrimination complaint investigation information
  • Legal case data
  • Accusations of policy/legal violations

Security Clearance Investigation Records

  • Background investigation information
  • Personal credit history
  • Personal criminal conviction history
  • Arrest records

Insupportable Opinions

Marginal notes on any document indicating management bias or discrimination (e.g. “This guy’s too fat. He’d never make it,” or “She’s too old for this job.”)

Source:  http://www.management-advantage.com/products/free-personnel.htm

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