Recordkeeping tips regarding employees

Maintaining your accounting records and books on a regular basis is a requirement for you as a business owner. Most small businesses should do so at least once a month. As long as your records are accurate and up-to-date, how you manage them does not matter. The best strategy is to keep it simple and do what is most comfortable for you. Don’t forget how important it is to track employment records along with your other expenses.

Here are some tips for recordkeeping tips regarding employees:

The majority of records must be maintained from the start of employment, and some must be maintained even after the relationship has ended. Keeping records of rates of pay, time cards, payroll, and benefits records, and performance appraisals are as important as keeping job descriptions, candidate application resumes, interview notes, and hiring records.

Always maintain records for longer retention periods when state and federal recordkeeping requirements differ.

Payroll and personnel records should be retained for at least three years, including:

• Timesheets
• Detailed schedules
• Pay deductions for benefits

Other information about employees:

• Hire date
• Address
• Individual social security numbers
• Promotion and demotion dates
• Dates of termination or layoff
• Maintain records of all deductions from pay, such as under ERISA, the state SITW, and other withheld taxes.

Payroll records are not required by the federal government. They can be kept on paper or electronically. A DOL rule is that all records must be accessible by the Department of Labor (DOL) within 72 hours of a request – in particular, records that allow the DOL, your firm, and the employee to verify how much is owed to the employee.

Bookkeeping related to the Equal Employment Opportunity Commission (EEOC)

For the duration of an employee’s employment plus one year after termination, maintain the following personnel records:

• Applications for employment
• Job responsibilities
• Employment records
• Promotion or demotion records and related disciplinary actions
• Pay history
• Dismissal notice
• Any disciplinary action taken by the employer
• You should retain any records that affect an employee’s paycheck indefinitely.

Nearly all documents related to an individual employee should be kept confidential-but confidentiality is critical for:

• Keep records relating to COBRA in a separate file.
• Health-related information is covered by HIPAA.
• Information regarding background checks.
• Handbooks for employees

Destruction and shredding of records

Never destroy records if you learn that an employee has consulted an attorney, filed a complaint with the EEOC or the DOL, or may sue.

Medical records and vaccination programs

You should properly protect medical information relating to vaccine mandates if you have a client or company. In the case of frequent testing as an alternative to vaccination or as a reasonable accommodation, the results must be protected. This means that each employee’s vaccination records, COVID-19 test results, and influenza test results must be kept secure and confidential.

Keeping track of all your business records can be difficult. Halsey Resources can help automate and streamline your bookkeeping tasks list to save you time and stress. The investment in bookkeeping services may seem like an extra cost, but it can be a long-term advantage since it provides financial insight in real time and ensures tax compliance.

Contact us today to learn more!