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Saving and Safeguarding Documents Electronically

By March 20, 2014 February 19th, 2015 No Comments

At HR Knowledge, clients often ask if there are laws governing how employers need to save files electronically. Although going “paperless” would make our jobs so much easier, many employment laws such as the Occupational Safety and Health (OSH) Act, the Fair Labor Standards Act (FLSA) and the Family and Medical Leave Act (FMLA) and other government agencies, have certain recordkeeping and/or reporting requirements that have not fully caught up with the “electronic age.”

There is a lot to consider before going to electronic storage of employee files.  In general, employers cannot do this unless you can electonicfilingcabinetensure your electronic records system is securely backed-up. The system must be reliable and the records need to be accessible for quick retrieval. Employers must also maintain an access log.

Electronic Filing System Need to Be Designed Properly

Employers also need to consider how they would design the electronic filing system. There are several regulations that require certain employee documentation be maintained separately from the employee “basic” file. For example, the EEOC recommends that documents that identify race and ethnicity be kept in a “confidential” file so they are not accessible to those in your organization that make personnel decisions such as hiring, promotions and salary increases.  Therefore, you would need to consider creating one database for the basic file and one database for the confidential file and ensure that access to those files is securely maintained and there are different “clearances” for accessing the data.

There are also considerations for documents related to IRS regulations such as some payroll records, W-4s and state tax forms. The IRS states that they allow the electronic retention of records, however they also state in the same regulation that the electronic storage of records does not relieve the employer of “the responsibility of retaining the hardcopy records from which the computer records were derived.”

Before you decide to go electronic, the leadership team should spend some time ensuring that the documents can be electronically maintained based on compliance with each federal and state agency (IRS, DOL, EEOC, etc.) as well as accurate and easily accessible hard-copy reproduction in case the employee needs a copy or the company were to end up in a court case with a current or former employee and needed to be able to quickly produce documentation.

An employer will also need to have a “history log” so that you can see in some format each time a document has been viewed and by whom, especially for I-9’s that need an access log.

Social Security Number Safeguarding

Paperwork that contains employee social security information also needs to be safeguarded. Here is our standard safeguarding policy:

Management and employees are permitted to access and use certain personal information, such as Social Security Numbers, only as necessary and appropriate for such persons to carry out their assigned tasks for the Company and in accordance with Company policy.

The unauthorized access, viewing, use, disclosure, or the intentional public display of such information and the unauthorized removal of documents from The Company’s premises that contain social security number information is prohibited and can result in discipline up to and including termination of employment.

If an employee comes into contact with Social Security Numbers or other sensitive personal information without authorization from the Company or under circumstances outside of their assigned tasks, an employees may not use or disclose the information.

When necessary, documents containing social security information will be properly destroyed through shredding or other means prior to disposal to ensure confidential social security information is not disclosed.

For more information about whether and under what circumstances an employees may have access to this information, review their job description or contact Human Resources..