Learn the critical factors employers must consider when creating record retention schedules, beyond just mandatory legal requirements. Prepare for the SHRM-SCP certification exam with expert insights.
Table of Contents
Question
In addition to mandatory retention requirements what should employers consider when establishing their record retention schedules?
Answer
Statutes of limitation under state laws for related common-law claims. Since common-law claims such as contract, tort, and fraud claims are increasingly being brought against employers, employers are wise to consider statutes of limitation under state laws on related common-law claims in case they are longer than the statutory record retention requirements.
Explanation
In addition to mandatory record retention requirements set by various laws, employers should consider statutes of limitation under state laws for related common-law claims when establishing their record retention schedules.
Common-law claims such as contract disputes, tort allegations, and fraud accusations are increasingly being brought against employers. The statutes of limitation for these types of claims can sometimes be longer than the statutory record retention requirements mandated by law.
For example, while certain employment records may only be required to be kept for 1-3 years based on federal and state laws, the statute of limitations for relevant contract or tort claims in that state may be 4-6 years. In this scenario, if a lawsuit is brought against the employer during that longer window, not having the pertinent records could put the company at a serious disadvantage in defending itself.
Therefore, employers are wise to research and consider statutes of limitation under applicable state laws for common-law claims that could potentially be brought against them. Ensuring record retention schedules meet or exceed these timeframes can help mitigate legal risks and provide protection if such common-law claims arise. Consulting with legal counsel to determine the best approach is often advisable.
In summary, while adhering to mandatory statutory retention requirements is essential, employers should also factor in longer statutes of limitation for related civil claims under state law when developing their comprehensive record retention schedules and policies. This proactive, risk-aware approach is a HR best practice.
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