Personnel Records 01-10-2006

MINNESOTA'S PERSONNEL RECORDS ACT
Like just about everything else involved in your business, Minnesota law regulates the treatment of personnel files. Sections 181.960 - 966 of the Minnesota Statutes govern the rights and obligations of employer and employee in connection with certain records relating to the employee. Wisconsin has a statute that is essentially similar and discussed separately below.

The purpose of this presentation is to help you (l) structure your records system to promote easy compliance with state law and avoid disclosure of information you otherwise may not have to share; (2) understand when and how you must respond to an employee's request for access to personnel records; and (3) avoid liability for improper handling of personnel records.

I. WHO IS COVERED BY THE MINNESOTA PERSONNEL RECORDS ACT?

A. All non-public employers, regardless of size, must comply with the statute.
B. All of your current employees who perform services predominately within this state have rights under the statute.
C. All former employees who have been separated from their employment for one year or less have rights under the statute.
D. Independent contractors do not have rights under the statute.

II. WHAT IS A PERSONNEL RECORD?

A. The following items are considered personnel records:

Any employment application
Wage or salary history
Notices of commendation, warning, discipline or termination
Payroll deduction/withholding authorizations
Fringe benefit information
Leave records
History of salary/compensation, job titles, dates of promotions, transfers or other changes
Attendance records
Performance evaluations
Retirement records

B. The following items are not considered personnel records under the statute:

Written references concerning the employee, including those you received from others.
Information relating to an investigation regarding the employee's violation of a civil or criminal statute, or any other conduct of the employee for which you may be liable. However, this exception is not absolute. It may change once the investigation is complete, and, in the case of a criminal violation, once the matter concludes, either by the prosecutor's notification to you that there will be no prosecution or by the end of all criminal proceedings. After that point, if you take adverse action against the employee on the basis of information contained in the investigation, then that information is no longer protected by this exception.
Certain education records if the employer is an educational institution.
Results of a test you give, other than a cumulative test score for a portion of the test or the entire test.
Information concerning your salary system and staff planning such as expansion, downsizing, reorganization, job restructuring, future compensation plans, promotion plans or job assignments.
Written comments about another person, if release of that information would be an invasion of that other person's privacy.
Records kept by the employee's supervisor or an executive, administrative or professional employee, provided that the author alone keeps them.
Information that is legally privileged or otherwise not discoverable in an administrative or court proceeding.
Written or transcribed statements of another employee concerning the employee's job performance or misconduct if the content of the statement would identify the co-worker.
Medical reports and records.

C. If you omit from a personnel record information that should be there, you cannot use that information against an employee in an administrative or judicial proceeding unless you did not intentionally omit the information and you give the employee a reasonable opportunity to review the information before it is used.

D. The statute does not say you have to keep these records. It simply says that if you have them, you must make them available to an employee upon proper request.

E. The best time to separate "personnel records" from "non-personnel records" is not when the request is made. The requests frequently occur in the context of employment litigation, when the selective turning over of materials will cause suspicion. Instead, prepare for these requests before they occur. Statutory "personnel record" items, if possible, should be kept in a separate file. Have one file for your statutory personnel records, and keep everything else separate.

III. WHEN MUST PERSONNEL RECORDS BE SHOWN TO AN EMPLOYEE?

A. An employee's statutory request to review personnel records must be made in writing.

B. The employee's request to review need not be granted if the employee has reviewed the records within the preceding six months, unless the employee has been terminated. Separated employees have the right to review the records once at any time within the one-year period following their termination.

C. You must comply with a proper written request within seven working days of receiving it if the record is kept in this state. If they are kept outside Minnesota, you have fourteen working days to comply.

D. Compliance requirements where a current employee makes a request:

You may provide the original record or a copy for review.
The documents must be made available at the employee's place of employment or a reasonably nearby location. You do not have to make the records available during the employee's working hours.
If you want, you can have a representative present while the employee reviews the records.
Once the review is over, you must give the employee copies of the records if they make a written request. You may not charge a fee for the copies.

E. With former employees, you may simply provide a copy of the records rather than arranging a review, but you cannot charge a fee for the copy.

G. If you can somehow prove that a request to review is made in bad faith, you do not have to honor the request. If your refusal is challenged in court, you'll have to prove the request was in bad faith.

IV. WHAT HAPPENS IF THE EMPLOYEE DISPUTES INFORMATION IN THE RECORDS?

A. You and the employee may agree to remove or revise the disputed information.

B. If there is no agreement, the employee can submit a written statement identifying the disputed information and explaining the employee's position.

The written statement cannot exceed five written pages.
You must keep that statement in your records with the disputed information as long as you keep the disputed information there.
If you give anyone else a copy of the disputed information, you must also give him or her a copy of the employee's statement.

V. CAN INFORMATION IN PERSONNEL RECORDS SUBJECT THE EMPLOYER TO DEFAMATION LIABILITY?

A. When Communicated by the Employee:

If the employee spreads disparaging information about himself that he learned by reviewing the personnel records, no claim for defamation may be brought unless the employee had disputed the information and requested its removal or revision or inclusion of his own statement, and the employer failed to do so.

B. When Communicated by the Employer:

If the employer communicates information contained in the personnel record that is defamatory, the employer may be liable. The fact that the information originates from the record provides no immunity, by itself, from suits. However, if the employee has reviewed the personnel record, then some protection from suit exists if the employee did not follow the dispute mechanism outlined above. In other words, if the employee reviewed the record and did not dispute it, then the employer can't be held liable for communicating that record to others. If the employee did dispute the information, then a suit may be brought if the employer failed to follow the dispute procedure.

C. What Communications are Protected?

This protection against defamation suits is very narrow. It covers only statements the employee learns by reviewing the records. If you tell an employee he's a thief when you fire him, and put a document calling him a thief in your personnel records, the oral statement you made may be the subject of a defamation suit even if the same statement contained in the personnel record is not.

VI. WHAT OTHER LIABILITIES MAY ARISE FROM THE STATUTE?

A. Retaliation is Prohibited.

An employer may not retaliate against an employee for asserting rights under the Personnel Records Act. The employee can sue for actual damages, back pay, reinstatement (if fired) or other "make-whole" remedies, plus attorney's fees and costs.

B. Civil Liability

If the employer fails to follow the statutory requirements, for example by failing to include the employee's statement with respect to disputed records, the employee can sue for actual damages that result.

C. Fines & Penalties

Violations of the statute may also be penalized by the Department of Labor in a civil suit with fines of up to $5000, plus attorney's fees and costs.

WISCONSIN PERSONNEL RECORDS STATUTES
Wisconsin law is similar to Minnesota law concerning what personnel records are subject to disclosure. Employee records are governed under Wisconsin Statute § 103.13. Under this statute, the term "employee record" or "employee file" is not defined. This statute only explains that employee records, for those employers who choose to keep them, are open to employees and lists which records an employee is not entitled to inspect.

I. EMPLOYEE RECORDS ARE CONSIDERED "OPEN RECORDS."

A. Every employer shall, upon the request of an employee, which the employer may require to be made in writing, permit the employee to inspect any personnel documents used in determining that employee's qualifications for employment, promotion, transfer, additional compensation, termination or other disciplinary action, and medical records. An employee may request all or any part of the records.

B. Certain Records do not need to be Disclosed, such as:

Records relating to the investigation of possible criminal offenses committed by that employee.
Letters of reference for that employee.
Any portion of a test document, except that the employee may see a cumulative test score for either a section or the entire test.
Materials used by the employer for staff management planning, including judgments or recommendations concerning future salary increases and other wage treatments, management bonus plans, promotions and job assignments or other comments or ratings used for the employer's planning purposes.
Information of a personal nature about a person other than the employee if disclosure of the information would constitute a clearly unwarranted invasion of the other person's privacy.
Records relevant to any other pending claim between the employer and the employee, which may be discovered in a judicial proceeding.
Although medical records are considered part of the materials ordinarily open to review by the employee, if the employer believes that disclosure of an employee's medical records would have a detrimental effect on the employee, the employer may release the medical records to the employee's physician or through a physician designated by the employee, in which case the physician may release the medical records to the employee or to the employee's immediate family.

II. THE REQUEST TO REVIEW PROCEDURE

A. How Often Must the Records be Released?

The employer shall grant at least two requests by an employee in a calendar year, unless otherwise provided in a collective bargaining agreement, to inspect the personnel records relating to the employee.

B. How Quickly must they be Produced?

The employer shall provide the employee with the opportunity to inspect the personnel records within seven working days after the employee makes the request for inspection.

C. Where and How?

The inspection shall take place at a location reasonably near the employee's place of employment and during normal business hours.

If the inspection during normal business hours would require an employee to take time off from work with that employer, the employer may provide some other reasonable time for the inspection.

In any case, the employer may allow the inspection to take place at a time other than working hours or at a place other than where the records are maintained if that time or place would be more convenient for the employee.

An employee who is involved in a current grievance against the employer may designate in writing a representative of the employee's union, collective bargaining unit or other designated representative to inspect the employee's personnel records which may have a bearing on the resolution of the grievance. The employer shall allow such a designated representative to inspect that employee's personnel records in the same manner and when the same rights as the employee.

D. Can the Employee Demand Copies?

The employee may request copies of the records, and the employer may charge a reasonable fee, not exceeding the actual cost of reproduction.

III. EMPLOYEES MAY DISPUTE INFORMATION IN THE RECORDS.

A. If the employee disagrees with any information contained in the personnel records, a removal or correction of that information may be mutually agreed upon by the employer and the employee.

B. If an agreement cannot be reached, the employee may submit a written statement explaining the employee's position. The employer shall attach the employee's statement to the disputed portion of the personnel record.

C. The employee's statement shall be included whenever that disputed portion of the personnel record is released to a third party as long as the disputed record is a part of the file.

IV. PENALTIES FOR VIOLATIONS.

Any employer who violates the statute may be fined not less than $10 or more than $100 for each violation. Each day of refusal or failure to comply with a duty under the statute is considered a separate violation.

MISCELLANEOUS TYPES OF RECORDS EMPLOYERS MUST KEEP
Neither the Minnesota or Wisconsin laws discussed above require the employer to keep the kinds of records discussed. These laws merely regulate the employee's ability to access the records if they are kept. Other laws, however, do require various employment records to be maintained by the employer.

The following list provides a sampling of state and federal rules that require retention of certain employee records. It is not intended to be all-inclusive.

Employment applications, hiring documentation, documentation of job movements, job orders and advertisements, test papers, layoff or termination information, results of physical examinations, and requests for accommodations must be retained for one year or until final disposition of a pending charge or litigation. These documents are required under the Wisconsin Fair Employment Act.
Under the Age Discrimination in Employment Act, records showing basic employee information, such as name, address, date of birth, occupation, and rate of pay, must be retained for three years.
State and Federal wage and hour laws require that certain records be maintained for three years, including records containing employee payroll information and sales and purchase records.
Unemployment records must be retained for at least six years.
Workers' compensation records must be maintained for 12 years from the date of injury.
The Occupational Safety and Health Administration (OSHA) requires that certain records such as OSHA Forms 101 and 200 be retained for at least five years.
Family and Medical Leave Act records must be retained for at least three years.
Employee Retirement Income Security Act (ERISA) and COBRA records must be maintained for at least six years.
Federal tax compensation records, including social security records, must be maintained for at least four years.