The Problem with HR Files
How many pieces of paper are in your employee HR files? If you’re like most organizations, the answer is “a lot!” Not only is there a lot of paper, but there are a lot of different laws and rules governing the retention of the paper – from the IRS to the EEOC, legal requirements must be met.
Multiple Pieces of Paper, Multiple Files, Multiple Years = Multiple Problems!
There’s little argument from any HR professional that paper HR files present numerous problems and that effective HR Records Management can solve those problems. Here some of the issues we’ve encountered:
- Cramped office space. Paper-based filing systems take up a lot of room, especially when you factor in the files that must be kept even after an employee leaves. One HR manager we talked to said that her office was so packed with file cabinets that she was no longer able to use her office to conduct interviews, but had to schedule time in the conference room instead.
- Difficulty locating flies. Unless meticulously maintained, paper files have a way of being mislaid. For most organizations, the days of a dedicated file clerk are long gone. Files are removed from file cabinets by whomever needs them, and frequently misfiled when they’re returned.
- Missing documents. An opened file on someone’s desk frequently leads to a document within the file to go missing, as it’s inadvertently scooped up with another pile of papers.
- Damage. Paper is subject to loss by water damage, fire and other unexpected catastrophes.
- Difficulty of Multi-location access. HR files are usually maintained in the home office, which is great, if you’re in the home office. But if you’re located at another site, and need access to information in someone’s personnel file it can be time consuming at best, impossible, at worst.
Many HR leaders know that they have a problem, but are at a loss as to how to solve it. For many, the solution is renting a storage area and having the files hauled off to storage. While this solution might free the HR manager’s cramped office, and provide temporary relief, in the long run, it only exacerbates the other issues: (1) Files that were difficult to find and access before become even more difficult to access when they’re in storage; (2) Documents that were easily lost are lost more frequently as the files that were removed from storage remain on desktops longer before they’re returned; (3) Surprisingly, even damage to files often increases, not from fire or burst pipes, but from spilled coffee (!), as the files languor on desks.
A company’s employees are its greatest assets, but managing their files can be a company’s biggest liability. You have to manage a huge amount of information, application files, benefits, payroll, taxes. And all the agencies interested in those files—the IRS, EEOC, and Department of Labor– have different rules about how long these records have to be maintained.
Download our White Paper HR File Management Problems Solved! and learn how to focus more on HR assets and less on HR liabilities.
This article was previously published, but has been edited and updated.