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Records are at the very core of what a human resources (HR) department does. As the managers of an organization’s most vital resource pool, HR professionals must maintain the records of every hiring, firing, and grievance. 

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HR is the backbone of a good corporate culture. An effective HR department will mean employees that feel looked after and a sense of trust in the management of the business. Properly managing the records of your employees is a huge part of establishing that trust.

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For many businesses, the HR manager or department also manages payroll. So, on top of the personnel files and other records, they must also maintain records of employee earnings, invoices, and a host of other important documents come tax time. With so many varying record types and such a vital role in managing them, it is only natural that HR professionals would be constantly searching for more efficient ways to manage records. With that in mind, let’s take a look at what records retention and management means in the context of human resources.

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What is a Human Resources (HR) Record?

There is no simple answer to the question of what, exactly, qualifies as an HR record. This is because the answer largely depends on how an organization is structured and how broad the purview is of the HR department. For some smaller businesses, the HR department may deal with almost all of the accounting and payroll records for the business. For larger organizations, they may play a more segmented role.


At their most fundamental level, HR records can be described as any record of the internal functioning of a business or organization. They are the memory of the organization, serving to ensure that failures are documented and learned from, that legal disputes can be resolved effectively, and ultimately that the business or institution can continue to build on a foundation of defined processes. A business with no memory is a shaky idea indeed.

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Types of HR Records

While what is considered an HR record may differ from organization to organization, there are some fundamental categories of HR records that will be consistent across just about any business or industry. Here are a few of the most common examples.

Personnel Files

Personnel files include everything that was generated and collected during the on-boarding process, including offer letters, signed contracts, copies of any signed employee handbooks etc., as well as any ongoing assessments of performance. These records are generally available to the HR manager and any superiors or managers of the employee.

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Payroll Files

Payroll files should be a record of any and all things related to an employee’s compensation or taxes. This includes direct deposit forms, filled out W2 or 1099 forms, W4 forms, time-off requests, and anything else that may need to be referred to in any wage disputes or questions about tax withholding.

Medical Records

Not every organization will keep extensive medical records for their employees. Most medical records will generally only apply to businesses that provide their employees with health care. However, there are some exceptions that apply to hourly employers, such as records of any injuries sustained while on the job. Broadly, medical records are any personnel records that pertain to medical treatment, insurance, or liability, such as health insurance application forms, physician’s notes, worker’s compensation claims, drug tests, and many more.

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Confidential Employee Files

These are secure employee files that should only be viewed or managed by HR professionals. They will include all of the sensitive or personally identifiable information that relates to an employee, such as their social security number, their marital status, their criminal background, or any other protected private information.

Investigation Files

Investigation files will be created in response to a specific investigation into an incident or an employee’s conduct. They will include any interviews, depositions, or other documentation that pertain directly to the investigation. As with confidential employee files, they should only ever be accessible to members of the HR department.

Training and Development Records

While these are sometimes contained within the individual personnel files of employees, some HR departments also choose to maintain a separate record for employees detailing their professional development, including any certifications that they have attained through any company-sponsored programs.

HR Record Retention Guidelines

Record retention is obviously fundamental to the operation of human resources. Keeping a clear, accessible, and accurate record of a business’ operations and employees is vital. However, it’s not quite as simple as just “retaining records”. This is because of a dichotomy that is at the heart of all records management: the demands of regulation and the limitations of storage.

Regulation

Keeping accurate records of your organization, employees, and payroll isn’t just necessary for the effective operation of a good business. Much of it is also necessary to be on the right side of the law or, rather, several laws. Every record should have a retention schedule, even if it is indefinite, to ensure that your business is able to meet legal challenges and weather audits without unnecessary losses.

Storage

The answer to legally-mandated record retention periods seems obvious. Just keep everything! Unfortunately, even in the age of ever-expanding digital storage capacities, keeping everything is not a cost-effective option. Paper-based records require adequate, temperature-controlled storage space and even in the case of digital files, keeping every record of a large organization could result in a massive amount of redundant, obsolete, and trivial (ROT) files. Thus, the constant dance between efficient records retention and the letter of the law.

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