Time to Spring Clean Your Employee Files? Read This First…

With Spring approaching, you may be tempted to clean and purge some employee files. Before you shred anything or push the delete key, keep in mind that California employers are required to retain employee records for a specific period of time to ensure compliance with state and federal laws. Human Resources files, which contain critical documentation such as employee hiring (including I-9s), performance, compensation, and benefits records, must be carefully managed to avoid legal complications. Understanding the record retention requirements is essential for businesses to reduce the risk of fines, lawsuits, and other legal consequences.

Record Retention Requirements in California

California's record retention requirements are governed by both state and federal guidelines. Employers must comply with the California Labor Code, California Code of Regulations (CCR), and federal regulations such as the Fair Labor Standards Act (FLSA), Equal Employment Opportunity Commission (EEOC) guidelines, and Occupational Safety and Health Administration (OSHA) rules.

Employers may maintain employee records in electronic form, but these records must be easily accessible, properly backed up, and securely stored. Both digital and paper records are subject to the same retention requirements.

Another reason to ensure you are complying with record retention requirements is that current and former employees have the right to inspect their personnel files. Employers must allow employees to review their files within a reasonable time (usually 30 days) and provide copies if requested (a nominal fee can be charged for copying employee file contents).

The retention periods for employment records can vary widely. Some records must be kept for several years, while others can be disposed of after a short period. The proper management of these documents helps employers avoid penalties and ensure compliance with employment laws.

CEA has compiled a fact sheet on record retention to make it easier for you to keep the requirements straight. CEA Members can access the Record Retention Fact Sheet. Once the retention period for a record expires, employers must securely destroy the documents. This could involve shredding paper files or using data-wiping software for digital records. Proper destruction ensures that sensitive information does not fall into the wrong hands, preventing identity theft or legal issues.

Record retention is crucial for compliance with both state and federal laws in California. Employers must be diligent about maintaining the required documents for the prescribed period to avoid legal risks and fines. By following these retention requirements and ensuring records are securely stored, employers can protect themselves from potential lawsuits and regulatory penalties. Members can call CEA with any questions!