Recordkeeping Requirements

Several laws contain either explicit or implicit recordkeeping requirements. These laws include the Americans with Disabilities Act (ADA) , Age Discrimination in Employment Act (ADEA) , Equal Pay Act , Executive Order 11246 , the Family and Medical Leave Act (FMLA) , the Fair Labor Standards Act (FLSA) , the Rehabilitation Act , Title VII of the Civil Rights Act of 1964 , Immigration Reform and Control Act (IRCA) , Occupational Safety and Health Act (OSHA) , the Employee Retirement Income Security Act (ERISA) , and the Vietnam Era Veterans' Readjustment Assistance Act of 1974. The list below includes various types of records, the length of time those records must be retained, and the law requiring the records retention. In many cases, several laws require that a particular record must be maintained. In those cases, the law with the longest recordkeeping requirement is listed.

Type of Record; Length of Time to Retain; Applicable Law

• Job order submitted to a state agency; one year; ADEA
• Job advertisements and internal job postings; one year; ADEA, FLSA and ADA
• Employment applications; three years; FLSA
• Biographical data (name, address, birth date, sex, etc.); three years; FLSA
• Applicant flow information; one year*; ADA, ADEA, and Civil Rights Act
• Medical records; one year**; ADA, ADEA, and Civil Rights Act
• Offer and hiring records; one year*; ADA, EO 11246, Civil Rights Act, Vets Act
• Promotions, demotions, and transfers; one year*; ADA, ADEA, and Civil Rights Act
• Qualified plan (welfare or retirement) records; six years; ERISA
• Layoffs; one year; ADA, ADEA, and Civil Rights Act
• Payroll records; three years; ADEA, Equal Pay Act, FMLA, and FLSA
• Time cards; three years; ADEA and FLSA
• INS Form I9; latter of three years after hire or one year after termination; IRCA
• Employment contracts; three years; Equal Pay Act and FLSA
• Employee pay and benefit plans; three years; FMLA
• Records and logs of occupational injuries; five years; OSHA
• Employee exposure to toxic substances; 30 years after termination; OSHA
• Employee terminations; one year; ADA, ADEA, EO 11246, and Civil Rights Act
• Record of employee disputes; three years; FMLA
• EEO-1 and Vets-100 reports; one year; ADA, EO 11246, Civil Rights Act, Vets Act

*If, while completing the Affirmative Action Plan, an "adverse impact" is discovered, then the records must be maintained until two years after the adverse impact is eliminated.

**Medical records related to a leave granted under the Family and Medical Leave Act (FMLA) must be maintained for three years.

Any records that are a part of a lawsuit must be retained at least until the lawsuit is resolved. Records of leave of absences granted under the Family and Medical Leave Act (FMLA) must be retained for three years.

Posting Requirements

See posting requirements in the Legal Issues section.

Recordkeeping Methods

Personnel records can be maintained in one of the following basic systems:

1. Manually (in file cabinets without a computer),
2. With an integrated Payroll/Human Resources system,
3. With a stand alone Human Resource Information System (HRIS), or
4. Any combination of the three.

Refer to the section above (Recordkeeping Requirements ) for information on what type of information should be maintained and for how long.

Manual personnel record systems exist in almost all companies, almost always in conjunction with some computer system. A few companies are moving in the "paperless" direction in which no paper copies of records are maintained. All records are stored electronically. However, for most companies, that practice is years away. Office supply stores can provide information on various manual recordkeeping and storage systems.

An integrated Payroll/Human Resources system has a big advantage in efficiency. Since Payroll and Human Resources need many of the same data elements, the common data need only be entered and maintained once and both functions can use it. Also, data reporting is easier. The disadvantage of integrated systems is that often neither the Payroll nor Human Resources functions are fully satisfied with the system because it doesn't include all the features they want.

Stand alone Human Resources Information systems are appealing to the Human Resources department, because they are designed to satisfy the Human Resources function specifically. The downside is the effort needed to manage the often cumbersome interface between the HRIS system and the Payroll system. Being without an interface is even worse, since the Human Resources and Payroll systems must then spend the organization's resources entering duplicate data onto the two systems. High end client/server systems overcome this problem by providing a smooth and seamless interface.

Issues to Consider when Purchasing an HRIS System

For very large organizations with a budget to match, a client/server based system is best. For smaller organizations, find an integrated Payroll/Human Resources system that adequately satisfies the need of both functions. Other issues to consider are:

• Cost. There's a very wide spread in the cost of Human Resources Information Systems. A very basic low end desk top system can cost as little as $300. The highest end client-server systems for very large organizations can exceed $1,000,000. Most desk top systems range from about $3,500 to about $35,000. Client/server systems start at about $100,000 and can go over $1,000,000. The more costly systems are the most comprehensive and flexible systems.
• Flexibility. No system comes out of the box in exactly the right configuration that an organization needs. Every organization has a unique set of needs. Therefore, a system will require some customization for optimal use by the organization. The more flexible the system, the more simple it is to customize. Customizing inflexible systems could render them inoperable or make them impossible to upgrade.
• Support. The system will be more supportable if it uses a popular database platform and operating system. Determine what support the software vendor can provide, what in-house support is available, and what support is needed to install and maintain the system.
• Compatibility with the payroll system and other systems.
• Functionality. Does the system contain all the modules your organization requires? Consider the following areas: benefits tracking, flexible benefits, COBRA tracking, applicant tracking, recruiting, job requisition control, time and attendance, position control, skills inventory, EEO/Affirmative Action tracking and reporting, health and safety, compensation, retirement plans.
• Report writing. The ideal report writer is both easy to use and has powerful reporting capabilities.

The October 1995 issue of Human Resource Executive magazine and the November 1996 issue of Controller magazine (www.controllermag.com) provide a comparison of Human Resources Information Systems.

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