Safekeeping of Personnel Records

Personnel and related records present risk to Hawaii employers if not stored, maintained and disposed of appropriately. Hawaii employers should designate at least three levels of security for access to employee information/records.

A person receiving one or more of the three designations should be given the authorization in writing. The levels are as follows:

Level One: Personnel Records

Personnel records, whether in hard-copy form or in computer files, must remain secure at all times. There is no valid reason that any person should have access to an employee’s personnel file unless that individual is required to work with information in the file for a legitimate purpose, such as accessing an employee’s file for information on an accident for a workers’ compensation claim. Even in this situation, Hawaii and federal law require workers’ compensation records to be maintained separately from the employee’s human resources file.

Employees who are authorized to access personnel files should be required to sign confidentiality agreements requiring them to be responsible for maintaining the secrecy of any information they obtain from reading the files. Such agreement should require the employees to agree that they shall not release any information to any unauthorized individual. It should also clearly indicate that the employees understand that any breach of confidentiality or other release of information in the personnel files shall be grounds for immediate dismissal and/or prosecution, if authorized by law.

Level Two: Employment Tests (Excluding Drug Tests)

The results of employment testing, whether for initial employment, promotions or reassignments, should be retained in a separate, secure location and maintained by an employee or employees who is/are specifically authorized to perform this function, whether on a full- or part-time basis.

Level Three: Medical Records and Drug Tests Results

What is true for personnel files and employment tests is especially important for medical records and the results of drug testing. These records should be protected by extraordinary access limitations. In hard-copy form, medical records should be kept in separate, sealed folders with initials across the seal. No one should be permitted to review medical records, even those who are regularly required to post information in personnel folders or files. The only individuals who should be permitted to see medical records are those specifically authorized in writing by the top HR manager. Medical records should be filed in a separate location, away from personnel records and employment testing records, under the custody of specifically designated individuals. Depending on the circumstances, and the context in which the records are being maintained, such records might also need to be maintained consistent with HIPAA.

Computer Systems

Computer system access to personnel files should be coded and should have the same levels of access as discussed above.

Contract or Outsourced Work

The same standards for record access and control should apply to any work that is contracted to outside vendors. Such contractors should sign confidentiality agreements and have the same stringent system of record-keeping and controls that apply to in-house work.

Record Retention

One way to help prevent the unauthorized release of information is to strictly adhere to time limits for record retention. The two broad groups of regulations involving record retention are equal employment opportunity statutes and laws covering other subjects.

Equal Employment Opportunity Statutes – Generally, under U.S. Equal Employment Commission regulations personnel and employment records must be kept for one year. However, such records must be kept for one year following an employee’s involuntary termination. When a charge of discrimination is involved, records must be kept until the issue is resolved. Management should be take care to override the purging of documents, including those in electronic form where it knows or has reason to know that a legal dispute related to the records is or will be initiated.

Requirements Under Specific Laws – In addition to this general regulation, there are record requirements under specific laws:

Age Discrimination in Employment Act – Keep payroll records for three years. Keep employee benefit plans and written seniority or merit plans as long as they are in effect and one year following their termination.

Equal Pay Act – Keep records for two years that apply to wage rates, job evaluation results, documentation of reasons for wage differences of female and male employees, seniority and merit procedures and provisions in collective bargaining agreements. (See the Fair Labor Standards Act for records that must be maintained for three years).

Americans with Disabilities Act – Keep records for one year involving personnel actions such as new hires, promotions and disciplinary actions. Also keep for one year documentation on requests for reasonable accommodation. Keep for two years records pertaining to apprenticeship programs.

Rehabilitation Act of 1973 – Federal contractors must keep employment records for two years from the date of an employment decision or the making of a personnel record, whichever is later. Records include applications, job postings, job descriptions, employment offers, tests used, employment policies and procedures, interview notes and personnel records. Record retention is only one year for contractors who either have less than 150 employees or have contracts less than $150,000.

Executive Order 11246 – Record and retention requirements are the same as those under the Rehabilitation Act of 1973.

Vietnam Era Veterans’ Readjustment Assistance Act – Record and retention requirements are the same as those under the Rehabilitation Act of 1973.

Other Statutes:

Family and Medical Leave Act and Hawaii Family Leave Law – Keep records for three years for such documentation as any disputes about granting leave, dates and hours of leave taken, and written policies and procedures.

Occupational Safety and Health Act and Hawaii law – Keep records for five years after the calendar year ends to which the records apply. Records must be transferred to succeeding employer in the event the business is sold.

Labor-Management Reporting and Disclosure Act – Keep records for five years from the date of the report.

H-1B & H-1B1 Visa Program – Keep payroll records three years from the date they were created. Keep all other records required under the program for one year.

H-2A Visa Program – Keep records for three years after the date the work contract is completed.

H-2B Certification for Temporary Non Agricultural Work – Record retention requirements are the same as those under the H-1B & H-1B1 Visa Program.

McNamara-O-Hara Service Contract Act – Keep records for three years after work on the contract is completed.

Davis-Bacon & Related Acts – Keep records for three years after work on the contract is completed.

Copeland “Anti-Kickback” Act – Keep records for three years after work on the contract is completed.

Employee Polygraph Protection Act of 1988 – Keep records for three years after the polygraph is conducted. Records include employer statements explaining the justification for examining an employee in conjunction with an investigation prompted by an economic loss.

Fair Labor Standards Act – Keep records on non-exempt employees for three years that pertain to payrolls, collective bargaining agreements, sales and purchases. Keep for two years records used to compute non-exempt employee wages, such as time cards, work schedules and the related. Hawaii law requires wage records to be maintained for six years. Both federal and Hawaii law require a significant amount of information to be maintained.

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