Record-Keeping Policies: How Long Should You Store Data?

February 27, 201712:58 pm336 views
Generic placeholder image

Have you ever spent hours searching for important data among mounted piles of paperwork? How do you keep your company data – in storage cabinets or disk drives? How do you decide which data should be stored where and for how long, and those not? How long should you store data related to your business and employees?

Too much data piling up in the limited storage spaces often poses a cumbersome exercise to look for critical information for business leaders. Every time the company welcomes a new employee, the HR managers are required to feed in more new data into the system. Meanwhile, old data from the employees who may no longer be employees of the organisation, still need to be retained and stored safely for future reference.

Considering this ongoing process of data addition to your company records, it is inevitable that storage spaces are always a concern – be it bringing in new cabinets to store paperwork or upgrading servers to clear off bad files and store new data. When the system is full and overloaded, it could impede smooth business functioning as well.

The best way to avoid these problems is to discard old and unnecessary data to free-up spaces in your vault or on your server to make room for new additions in time. However, each type of data has different standards in terms of the storage period. Here are some of them:

See: Things Employees Should Notice in an Employment Contract

  1.      Proof of ownership. This includes land purchase information and building certificates, vehicles and electronic titles, as well as other proof of ownership records. Such data is fundamental for your business since it  involves the foundation roots and property ownership. Therefore, you should such important critical organisation data in the safest place.

Make sure that only authorised individuals can gain access to use or get a hold of the records. Also when you sell the assets, you should archive the associated records with the asset, just in case if there are any problem areas in the future.

  1.      Recruitment documents. When you advertise a job opening, you are required to deal with a pile of resumes, CVs, interview analysis and test scores of each candidate. Sometimes chosen candidates might withdraw from the recruitment exercise, or they might bail out at the last minute.

Hence, when someone does not pass through the hiring process, you need to store their data until some period of time. Through this method, data stored can always be used for references in the future, and you can immediately contact them without difficulty.

  1.      Employment records. When employees join your team, the piles of paperwork is bound to grow with new medical records, personal documents, employment contracts, and other human resources files being fed into the system and added to the employee database.

Also current data of employees who have been working with company for long, should be retained, stored safely and updated in time. When these employees quit or are terminated from their contracts, you should not discard their records right away.

You need to keep them safe for at least seven years after they have left the organisation. In cases, where unresolved issues related to tax, benefits, pension, or compensation arise, you can address them immediately.

  1.      Bank statements. This includes tax records, bank accounts, credit report, credit cards, and loan agreements. Keep these records as long as they are still actively used, and seven years after they are no longer needed. However, if these records are needed for tax or business purposes, therefore you might have to store it longer in order to avoid confusion in the future.
  1.      Insurance documents. It includes health, dental, social security disability, and unemployment benefits. You should keep them as long as the employee is still working for your organisation. When the employee is discharged off duties or terminated from job, you can still store their data for close to a year and more.

Most leaders are often doubtful, if they have to dispose off their outdated data and paperwork. One of the most common effective argument is that, since they never know if old data will be needed again in the future, they are reluctant to throw away old papers. While storing too much data in the backend could mean risking system breakdown in time, to hamper business functioning processes as a whole.

Read also: Role of HR in Driving Culture of Innovation in an Organisation