Personnel File System – What to Keep & How to Maintain It


Let’s face it, as a new employer, maintaining employees’ personnel files is not the most riveting topic. However, it is essential to keep documentation of all of your employees in a separate personnel file. That way, should any disputes ever arise, you will be able to show what your employees signed and agreed to.

A good personnel file system also helps to maintain structure and protection for both the employer and employee. The time you spend maintaining your personnel file is time well spent. It can save you thousands of dollars and much more time than if you choose not to maintain a good personnel file system…and find a lawsuit sitting on your doorstep one day. Also, once the system is in place, maintaining it should not take too much time.

In this article, we’ll go over why you should maintain personnel files, what files to maintain, how to maintain your files, and how long to store them.

Next, we’ll go over what files you should maintain in your personnel file system.

What Goes in an Employee’s Personnel File?

You should maintain a personnel file for each employee. Preferably, you should use something to keep the files protected and in order, like a labeled three-ring binder or two-hole bound legal pad.

So what goes in the file? In short, all job related documents should go into the personnel file for each employee. You should make sure to maintain your employees’ personnel files in a location where only individuals with a "need to know" have access to the personnel file (preferably under a lock and key). These individuals could include a human resource coordinator, the owner, or the employee on a need to know basis.

Some of the documents that could go into the personnel file of each employee include:
  • job application
  • effective date of hire
    • separate form for the actual date of hire (if available)
  • acknowledgment of employee handbook (if there is an employee handbook)
  • job description
  • letters of reference
  • offer letter
  • IRS Form W-4, Employee’s Witholding Allowance Certificate
  • Forms relating to employee benefits:
    • Pensions
    • Health insurance
    • Dental and vision insurance
  • Emergency contact forms
  • Blank employee performance evaluation – so each employee knows the company’s standards
  • Records of attendance
  • Training programs
  • Any contracts – if the employee is not an at-will employee
    • e.g. the employee is a "just cause" employee
  • Disciplinary actions
    • These forms will help to protect your company if an employee ever files a claim against the company for a disciplinary related matter
    • Any notes pertaining to discipline
  • Awards/recognitions
With multiple employees, you’ll also want to order your employee files. Many companies choose an alphabetical or organization structure of ordering employee files (or both, depending on the size of the company).

Next, we’ll go over what not to keep in an employee file.

What Not To Keep in an Employee File

An employer should not include too much information in an employee file because, as strange as it seems, that information can be used against the employer in a lawsuit. Additionally, some states allow employees to view their employee file at any time.

Files not to keep in an employee file:
  • Employee’s medical records
    • For example, if an employee is considered disabled, it is best to keep this information in a separate file where no one in the company has access to the information, except the human resource manager
      • This information is also strictly confidential and its access should be very limited
  • Form I-9
    • Should be kept in a separate file for each employee pursuant to the U.S. Citizenship and Immigration Services (USCIS)
    • It verifies eligibility of an employee to work in the United States
  • Non-related employee documents
    • Documents relating to an employee’s private life, race, religion, political affiliation, sex, etc.
    • These types of documents could be used against an employer in a discrimination claim or lawsuit
Next, we’ll wrap up this article with some of the main considerations to keep in mind.


Once you develop your own employee filing system, maintaining your employee files should not a burdensome task. Many employers use the time involved in performance evaluations as a good time to update each employee’s employee file and any information you may need. For example, perhaps you have a new company policy that the employee needs to sign. Also, make sure that the employee’s file contains all relevant and up-to-date information.

You should create a blank check-sheet for each employee’s file and use this to double check that all the information is there whenever you’re updating your employees’ files. And remember, generally only individuals with a "right to know" should have access to your employees’ personnel files. States generally provide different laws on who may view employees’ files. Check with your state laws or a local attorney for more information.

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