The Legal Risk of Poorly Managed Personnel Files

The Legal Risk of Poorly

Managed Personnel Files

Real life examples of how mismanaged personnel files

can lead to legal liability for you.

Bret YawAssociate,

Ford and Harrison, LLP

Moderator

Rebecca Ward

Sr. Marketing Content Specialist

(303) 219-7802

[email protected]

Presenter

Bret Yaw

Associate, Ford and Harrison

[email protected]

Questions

If you have questions during

the presentation, please

submit them using the

“Questions” feature

Questions will be answered

at the end of the webinar

Outline

• Overall Mentality Regarding Personnel Files

• Access to Personnel Files

• What’s In a Personnel File?– What Should Be Included?

• Discipline

• Evaluations

– What Should be Excluded?

• The “New” Landscape: Electronic Records– What Constitutes an Electronic Record?

– ESI Obligations

Overall Mentality Regarding Personnel Files

• A properly kept personnel file can be a useful defense in a lawsuit by an employee– Cannot overstate this

– Usually the first thing reviewed in litigation

– Keeping personnel files updated and accurate is very important

– Incomplete, sloppy or incorrect records can destroy an employer's defense to common employment law claims

• Think of a properly maintained personnel file as a “shield” against claims

Employee Access to Personnel Files

• Varies from State-to-State

– Numerous states, such as California, require

employers to provide employees with access to their

personnel file

– Many of these statutes allow employees to review

and copy their file at reasonable intervals

• Florida

– No right to access

What’s In a Personnel File?

• Documents include– Hiring documentation

– Jobs held, job descriptions, and pay

– Benefits elections

– Evaluations and disciplinary information

– Requests for time off (including FMLA)

– Notes from ADA interactive discussions

– Perks and other benefits

– Any notifications required (such as COBRA)

– Signature pages for policies

What’s In a Personnel File - Evaluations

• Employee Evaluations

– Scheduled evaluations

– Should be given by closest supervisor over employee

– Use forms for all evaluations

– Train supervisors to be honest and clear

What’s in a Personnel File - Discipline

• Discipline– Among most important documents

– Have policy on maintenance of reprimands or notes

– Keep with supervisor’s files or in centralized file

– Train supervisors on how to maintain information and communicate information to HR or other supervisors

What’s In a Personnel File – Discipline

• Why so important?

– If you don’t make a record of counseling or discipline

– your employee WILL deny it happened

• Gives rise to material factual dispute which

prevents resolution with SUMMARY JUDGMENT

– Employees should know when something goes in

their personnel file

What’s in a Personnel File – Discipline

• What/How to Document

• Produce contemporaneously with conduct

• Include:

• Date of document

• Name of employee and supervisor

• Name(s) of those present at meeting

• Type of discipline


• What/How to Document– Any prior disciplinary measures taken

– Reason(s) for discipline

• State facts, not conclusions or assumptions

• Provide specific examples

• Include dates, times, location, witnesses

– Describe impact

– Cite any applicable policy or rule



– Any progress, or the lack of progress since last

disciplinary action

– Expectation(s)

• Be specific; indicate required outcomes by specific

dates if appropriate

– Periodic meetings



– Any training or assistance that can be offered

• ADA Concerns?

– Any training or assistance that was provided



– Any corrective action taken

– Possible consequence if not corrected

• Very important

– Employee’s response or comments

– Signature of employee

• Provide signed copy to HR file and employee


• Best Practices• Document

• Document

• Document

• Be objective

• Whole truth and nothing but the truth

• Stick to the facts• date, time, what happened, witnesses, discussion with

employee, your response

• Review and use in decision making process for future discipline

• Review prior to evaluation

What’s in a Personnel File?

• Best Practices for Discipline/Evaluations

– Be consistent

– Be thorough

– Be objective

– Use plain English

– Be specific

– Maintain your focus on the job

– Be timely

– Be honest

– Be prudent

– Document your employees reaction AFTER YOU meet with

them- get them to sign document

What Does Not Belong in a Personnel File?

• Medical Records

• I-9 forms

• Garnishment orders

• Communications from counsel

• Other confidential communication

Welcome to the Electronic Age!

• Personnel files are not just paper records, but electronic

records as well

• Electronic records include:

– E-mails

– Attachments to e-mails

– Voicemails

• land line telephone voicemails

• cell phone voicemails

– Websites, Blogs

• employees sometimes may post disparaging remarks about

their employer on a personal website or blog.

– Instant Messaging


• Electronic records include

– Complaints or compliments from co-workers or

customers

• can be voicemail, e-mail

• can be e-mail from co-worker or customer OR

• can be e-mail from supervisor to himself

documenting a conversation with a co-worker or

customer

– “Employee Joe’s absences are putting a burden on the

rest of the department employees and they cannot get

their work done. Can you please talk to him?”


• Electronic records include

– E-mails from employees to supervisors

• asking for time off

• complaints

• responses to supervisor e-mails

Electronic Records – Caution!

• Remember that even separate files kept by a supervisor about a particular employee are considered part of an employee’s personnel file. – Example

• a supervisor’s file containing e-mails to himself documenting verbal counseling or conversations with an employee are part of the employee’s personnel file.

• Training is important– Train supervisors to use all electronic communications,

especially e-mails, regarding employees as if the employee will see it.

– People often write information in e-mails that they wouldn’t necessarily say out loud or write down on paper.

Obligations Regarding ESI

• Amendments to the Federal Rules of Civil

Procedure apply to every person or business

involved in federal court litigation

– New rules address the discovery of “electronically

stored information” (ESI)

– This includes ESI relating to or contained in an

employee’s personnel file


• The definition of ESI is vague. Most computer-based

information will be included in the category of ESI

• Therefore, the types of emails previously mentioned,

including those between supervisors and employees,

emails between supervisors regarding an employee’s

performance, and emails between an employee’s co-

worker and a supervisor regarding an employee all fall

into the category of ESI.

• Additionally, voicemail, websites, and instant messaging

should be considered ES


• In a lawsuit, ESI is the equivalent of a document

– Therefore, during the discovery period of a lawsuit, all

requests for documents include ESI

• Employers have a duty to preserve ESI just as

they would paper documents if litigation is

reasonably anticipated

– In other words, an employer must not destroy, alter or

fail to preserve ESI if litigation is reasonably

anticipated


• Don’t delete e-mails, voicemails, or other

electronic records from, to, or regarding an

employee

– Remember that these types of electronic records can

be part of the personnel file


• Adverse inference jury instruction

– Zubulake v. UBS Warburg (S.D.N.Y.)

– In an employment discrimination case, USB not only

failed to preserve important e-mails and lost various

others, several USB employees deleted relevant e-

mails against the advice of counsel.

– Court gave an adverse instruction, resulting in a jury

verdict of $29.3 million, including $20.3 million in

punitive damages.


• Monetary Sanctions

– Turner v. Hudson Transit Lines, Inc. (S.D.N.Y)

– Court imposed thousands of dollars in

monetary sanctions when the defendant

destroyed documents when it was on notice

of plaintiff’s lawsuit


• Dismissal of Claims or Defenses

– Computer Associates International, Inc. v. American

Fundware, Inc. (D. Colo.)

When the court found that the defendant deleted

electronic records after being put on notice of a

pending lawsuit, the court granted default judgment in

favor of the plaintiff

• Inability to Prove Defenses

ESI – How to Manage Obligations

• Have a document retention policy

• Train employees to comply with the policy

– Make sure supervisors are aware of what electronic

records (e-mails, etc.) are part of the personnel file

– Is your document retention policy being effectively

communicated to employees?

– Do your employees understand the policy?

– Enforce and monitor compliance – a policy is only

good if it is effectively implemented.

ESI – How to Manage Obligations

• “Litigation holds” are internal directives (or

directives from counsel) to preserve

documents that may be required for

litigation or government investigations

ESI - When to Implement a “Hold”

• Request for a file

– From a current or former employee?

– From employee or their counsel?

– Was the employee involuntarily terminated?

– Was there a threat of litigation from the employee?

• Demand letter from an attorney

• Receipt of EEOC charge

• Formal lawsuit complaint

Questions?

Bret Yaw

Associate, Ford and Harrison

[email protected]

(407) 418-4345

Automotive

The Legal Risk of Poorly Managed Personnel Files