3 HR Challenges And What You Can Do

Originally Published in Today’s Veterinary Business, December 2017


Recruiting, training and retaining quality employees is an ongoing challenge for veterinary practices of all sizes. Successfully doing so, though, is crucial if a practice is to thrive.

Team members involved in human resources should know how to address the three key issues below. Let’s look at the issues, questions to consider and methods of dealing with the challenges.

The Millennial Age

As baby boomers retire and Generation X ages, increasing numbers of millennials are entering the workforce. Expectations have been high for this generation, known as ambitious high achievers, but their transition into the workforce hasn’t necessarily been smooth. Intergenerational misunderstandings and conflicts waste millennial potential.

It’s important to note that a large percentage of millennials were raised by parents who packed their kids’ schedules with music lessons, sports practices and more. Many parents approached teachers and coaches if they felt their child did not receive a fair grade or wasn’t getting enough playing time.

Because of this helicopter parenting, some millennials are not as accustomed to asking for what they want and need, as previous generations were, which helps to explain why 93 percent of millennials left their last jobs and changed roles without first approaching their supervisor.

How can the lines of communication be opened between generations? How can the energy and talent of millennials be effectively harnessed in your practice?

  1. Work-life balance. According to one study, 57 percent of millennials say that work-life balance, along with personal well-being, is very important. A lack of flexibility was one of the main reasons millennials quit a job. How can you incorporate flexibility into your practice?
  2. Family oriented: Almost 40 percent of the millennial generation is so unhappy with the dearth of paid parental leave that they are willing to move to another country to obtain the benefit. How can you address the concern?
  3. Team oriented: Why does team-based work appeal to millennials? One, they find the work more pleasurable, and two, some prefer to avoid risk. Accommodating this preference would be beneficial to your practice, as these workers tend to contribute their best efforts when working in collaboration with others. They enjoy tackling challenges and don’t like to be bored. How can you harness this positive energy?
  4. Externally motivated: Many millennials are motivated by personal achievement and they appreciate participating in cross-functional situations where their expertise is merged with the skills of others to achieve common goals. They are accustomed to frequent feedback, so if you want to boost their potential in the practice, be transparent about your expectations and provide the desired feedback, including but not limited to regular performance reviews. Also, give praise and recognition when deserved, and create opportunities for promotions.
  5. Open communication: These channels are important to millennials. Despite being well connected via technology, they appreciate face-to-face time.

Drug Landscape

U.S. drug use and abuse negatively impacts the workplace. Heroin use is rising in many demographics and in both genders. Prescription opioids are problematic, too. More than two-dozen states and the District of Columbia have legalized marijuana, at least medically and sometimes recreationally.

Alcohol and drug abuse cost U.S. businesses an estimated $81 billion a year through lost productivity, according to one report. Substance abusers are absent 10 times as much as non-abusers and are late three times as much, studies show. Moreover, abusers use medical benefits 300 percent more often than non-abusers.

Veterinary practices face an additional challenge: a drug cabinet full of potentially addictive drugs, both controlled and non-controlled.

Drug testing is an option to address this situation in your workplace. What should your practice do? Steps include:

  • Become aware of your state’s laws on drug testing.
  • Create a formal, written drug abuse policy that addresses why the policy was established, what you expect from employees and what the consequences will be if the policy is violated.
  • Set the parameters of the drug testing policy, including whom you will test, when you will test, for which reasons you will test and the logistics of the testing procedures.
  • Determine how to address potential problems with drug testing. These include employee morale issues and resentment; claims that abuse-prevention programs are sufficient without testing; the financial expense; and legal challenges that may arise from the testing protocol.

Paid Time Off

Policies governing paid sick leave were left to individual companies before 2011, but then Connecticut mandated paid leave for service workers. Since then, Oregon, Massachusetts, California and Vermont, plus the District of Columbia and Puerto Rico, have passed paid sick-leave laws. Arizona joined the list last summer, and Washington State will be added in January 2018. Some counties and cities mandate paid sick leave for people working within their boundaries.

In general, states that have passed sick-leave laws require employers to provide an hour of paid sick time for every 30 hours worked, with 40 hours of leave annually often the minimum. This time typically can be used for family care as well.

To ensure compliance:

  • Know your state’s laws and be aware of pending legislation.
  • If paid sick leave is not required in your state, double-check county and city laws.
  • Review your practice’s policies.
  • Determine what modifications you should make. Perhaps create a policy from scratch if the necessary changes are significant.
  • Update your employee handbook and redistribute it.

Effective Jan. 1, 2018, New York is mandating paid family leave for all employees as part of a worker-funded initiative. Payroll deductions start at 70 cents a week and rise to $1.40. This means that any employee covered by the state’s temporary disability insurance law who has, for 26 weeks or more, worked full time will be eligible for paid family leave. This also applies if someone has worked part time for a covered employer for 175 days.

All private employers must participate, and public employers have the option to do so.

Click link to see article on Today’s Veterinary Business http://todaysveterinarybusiness.com/3-h-r-challenges-can/

Dissecting and Creating A Paid Time Off Policy

When it’s time to create your paid time off (PTO) policy, it’s important to answer the five Ws and the H: who, what, when, where, why and how. Focusing first on the “why,” note that, in the actual policies, you don’t typically share why policies are created in the ways they are, but you should definitely consider why you are creating each policy as they are formulated. Annually, when you review the policies, consider why updates should (or should not) be made.


Who will each policy apply to? How will they differ for different people? Some practices, for example, might offer 80 hours of paid vacation hours per year to full-time employees, while part-time employees working 20 hours per week would receive 40 hours, and so forth


What types of PTO will you offer? Vacation time? Sick time? Personal time? Some practices lump all the hours together as PTO because it’s easier, administratively speaking, to track the total number of days (or hours) someone has available rather than breaking it up into multiple categories. The advantage of breaking it up: you can limit vacation time, for example, or the number of days someone can call off for personal time.

What can employees do with unused days at the end of the year? Carry them over to the next year? If not, will that PTO simply expire or can employees ask to be paid for those unused days?


When can employees use the PTO? Making it all available at the beginning of the year is easier but some employees might use all the time in Q1 and quit, so perhaps half can be available in Q1/2; the other half in Q3/4. When can employees start to use PTO? Is there a waiting period? If so, the waiting period for practices is typically 30 to 180 days. When will the amount of available PTO increase for employees? After they’ve worked at the practice for three years? Five? By how much will it increase?


Where should employees submit their requests for PTO? In a designated place on the company’s internal website? In the mailbox of the human resource director?


How much notice will you require when someone requests time off? This ranges from one to six weeks in most practices, depending upon the types of PTO offered. Do you allow any last-minute requests (outside of sick days which naturally are last minute)? If so, what?


How #Me Too Affects You, Too

Originally posted in Today’s Veterinary Business, February 2018

Sexual harassment in the workplace must be dealt with promptly, fairly and firmly.

The #MeToo movement started last fall with claims of sexual harassment and rape against movie producer Harvey Weinstein. Before long, dark shadows were cast over other powerful men — from entertainment personalities Matt Lauer, Kevin Spacey, Russell Simmons and James Franco to politicians Al Franken and Roy Moore.

Although any accusation typically gets more publicity when a celebrity is involved, sexual misconduct occurs in all walks of life. What will you do — and should you do — as a veterinary practice owner or manager if an employee lodges harassment claims? What if the employee joins the #MeToo movement and goes onto social media to name names at your hospital?

If your team has a sexual harasser, your practice may be one complaint away from a disaster. How should your practice respond to the multilayered issue of sexual harassment? Do you know how to respond to complaints and proactively protect your practice?

Knowledge Is Power

First, take a good, hard look at your hospital’s sexual harassment training program and be honest with yourself. What is the quality of the program and how much effort do you put into it? If the program isn’t as well thought out and implemented as it could be and should be, you’re not alone, but improving it must be a priority. The training must pay more than lip service to the issue and must not be only a way to limit your liability if or when a complaint occurs.

Your program and policies must make a stand for respect and equality in the workplace, and you must amplify that by how you train, by how you communicate and by how you serve as a role model in your practice.

If you don’t have an anti-harassment training program, you need to create one now. It must be a top priority. You need to carefully craft harassment and sexual misconduct policies and procedures and share them with all your employees. Consider role-playing sexual harassment scenarios to give your team the opportunity to demonstrate and discuss the true impact of sexual harassment. If you don’t know where to start, consider hiring a practice consultant or human resources expert to construct a plan and conduct in-clinic training.

Your policies and procedures should provide multiple ways for an employee to report acts of harassment. If the only official avenue is for someone to go to his or her direct supervisor, how does it help if the supervisor is the harasser? This scenario, unfortunately, does happen.

Also have a plan for how you will follow through on complaints, and don’t rule out hiring outside legal counsel if appropriate. Once the policies and procedures are finalized, add them to the employee manual and go over them with the entire team. Review the policies annually, or more often if changes are made. Specific policies and procedures may vary by practice, but the bottom line in any document must be that sexual harassment will not be tolerated. It will be investigated promptly and addressed decisively.

Responding to Complaints

The U.S. Equal Employment Opportunity Commission requires prompt and proportionate corrective action whenever harassment is found to have taken place, with workplaces having both a legal and ethical responsibility to appropriately address complaints.

However, this does not mean that managers should assume the accused is guilty before an investigation has even started. Nor should assumptions be made based on gender — for example, assuming that men are the harassers and women are the victims. These approaches, in fact, are among the worst ways to respond. In today’s emotionally heated environment of almost daily news reports of sexual harassment, you must be fair to all parties and never punish a person based solely on an accusation or because of preconceived gender roles.

Step one is to take every complaint seriously and not rush to judgment. After you receive a complaint, promptly follow up and investigate thoroughly. Remember that anyone doing the investigating must remain fair and objective. Listen carefully to the complainant and assure the employee that retaliation for the complaint will not be permitted. Tell the complainant that if retaliation occurs or if harassment continues, you need to know about it right away and will address the behavior.

Document all discussions carefully, including the dates, times and witnesses to relevant events. When you inform the accused of the complaint, assure him or her that a fair and impartial investigation will take place and that guilt is not assumed.

Also, communicate regularly with the parties so they don’t feel ignored and explain that a rushed investigation serves no one well.

Once you’ve collected as much information as possible, use discernment in making the best decision you can about the complaint. Consult with an attorney to make sure you are looking at the situation appropriately. If the attorney has concerns about the investigation or the conclusions, take a good second look. You can move forward once the attorney supports your decision and reasoning.

Document all follow-up steps — from training to discipline — and keep the case files separate from regular personnel files.

Always Be Aware

Managers would be well-served to routinely monitor interaction among co-workers rather than wait for a complaint to be filed. Doing this might prevent less serious behaviors from expanding into full-blown misconduct. Keep an open-door policy as well so an employee feels safe sharing problems. If these conversations alert you to a sexual harassment situation — or even if you hear workplace rumors — they must be investigated.

Here are three additional steps to take:

  • Review your employment practices liability insurance policy to see if legal costs associated with harassment are included. Determine if you need more coverage.
  • Remain alert to sexual harassment issues and related legal cases, including those happening in other professions.
  • Each year, review your sexual harassment policies and procedures, adjust them as needed, and inform all employees about the changes.

Bad P.R.

Finally, what will your practice do if a team member joins the #MeToo movement and uses social media to out your practice or an employee? Don’t wait for this possibility to become a reality. Instead, be proactive and develop a plan to address the situation if someone connected with your practice goes public with a complaint. Address both the legal and public relations concerns and get input from your attorney and other relevant professionals.

Is your practice prepared? Even if your hospital never gets entangled in the #MeToo movement, ignoring it is a problem. Instead, acknowledge the campaign and explicitly tell your employees that you agree with the fight against sexism both in the workplace and away from it. Work with your managers so they are prepared to foster an environment in which everyone can be safe from harassment.

Train and support your managers so they know how to handle a situation in which they personally observe inappropriate behaviors. Empower your team to handle harassment claims by providing them with all the policies, procedures and resources they might need, and be prepared to back them up all the way.

Originally posted in Today’s Veterinary Business  http://todaysveterinarybusiness.com/how-metoo-affects-you-too/

Protecting Your Practice from Toxic Teams

“You know when a veterinary practice is toxic. You can almost smell it, that tang of adrenaline from spiking anger. You feel it. Your stomach sinks when you walk in the door and you sense the tension hanging in the air. Worse yet? You’re fully aware that the toxicity can lead to bad medical decisions resulting from spite or exhaustion or vindictiveness. The fantasies run through your head when you think about quitting – or finally getting up the courage to fire the bad apple that’s ruining the bunch. It all feels like a sickly gas floating through every client interaction, every treatment area procedure and every breakroom conversation.”

The article “Toxic Teams,” published in dvm360.com in February 2017, bluntly lays out what a toxic veterinary practice can feel like. Written by Rachael Zimlich, a registered nurse and journalist, the article also shares the dire potential consequences that can occur if a toxic environment is not addressed: bad medical decisions arising from spite, exhaustion or vindictiveness.

The article is also chock-full of responses to questions about the effects of toxicity in the veterinary workplace. They include the following results:

  • 93% of people surveyed agreed or strongly agreed that communication issues can affect patient care
  • 95% of people surveyed agreed or strongly agreed that communication issues can affect client care
  • 79% of people surveyed agreed or strongly agreed that team conflict can affect patient care
  • 90% of people surveyed agreed or strongly agreed that team conflict can affect client care
  • 78% of people surveyed agreed or strongly agreed that communication issues can change decisions about which doctors and team members see particular cases
  • 78% of people agreed or strongly agreed that communication issues make it difficult to agree to medical protocols
  • 76% of people agreed or strongly agreed that team conflict can change decisions about which doctors and team members see particular cases
  • 68% of people agreed or strongly agreed that team conflicts make it difficult to agree to medical protocols

So, how can your practice fight back against a toxic team environment? Here are six steps to take.

#1 Sliding Scale of Toxicity: Where Are You?

Practices fall along an entire spectrum of toxicity. If you’re one of the lucky ones, your team isn’t toxic, but you realize how you need to proactively keep it that way. If that’s the case, create policies that clearly define how communication should take place, which behaviors are acceptable and which ones aren’t, and the like. Get input from the various teams in your practice and, when the policy is formalized, add it to your employee handbook, hold meetings to discuss the new policy and review it annually, especially noting any changes.

If you recognize that your team already has a level of toxicity, go on to step two.

#2 Define What Behaviors Are Toxic

No two practices are alike, but common signs of toxicity include gossiping and bullying; staff feeling as though expectations are unclear and/or workloads are unreasonable; a management team that dictates what everyone should do without considering team feedback; and many more. Any one of these is a reason for concern and, if you recognize multiple toxic behaviors, the need for a solution becomes even more urgent.

#3 Model Appropriate Behaviors

Do as I say, not as I do. Managers and owners seldom say that statement out loud, but that message can easily be conveyed without ever being specifically articulated – and it is a recipe for disaster. If you want your team to communicate clearly and professionally, then that’s exactly what the managers and owners must do. If it’s important that team members follow specific policies and procedures, these need to be clearly provided – verbally and in writing – and the actions of managers and owners should not run contrary to them.

If you laugh about difficult clients after they leave, what message is that sending to your team? If you aren’t accountable to your team, how likely is it that they will ultimately be accountable to you? The actions of owners and managers must set the bar with high standards.

#4 Listen Carefully and Ask for Solutions

To get to the bottom of what’s making your practice toxic, you’ll need to talk to team members about their experiences, both good and bad – and you’ll need to carefully listen to what they tell you. You can use multiple formats to listen, including team meetings, one-on-one conversations, surveys where people respond anonymously and the like.

Don’t be afraid to ask your team to come up with solutions to identified problems. You are not obligated to use them, but you will probably find that many of them are quite good – and, since they have come from team members, at least some members of your practice will automatically be invested in making them work. There is also nothing wrong with setting the expectation that employees are responsible for attempting to solve their own problems, but practice owners and managers must ensure that the workplace is free from discrimination, harassment and the like.

#5 Address Toxic People Directly

Although team meetings can be excellent vehicles to gather information, they aren’t the best forums to handle toxic behaviors of a select number of employees. Instead, you need to set up individual meetings with people you’ve identified as participating in undesirable behaviors and come up with customized behavioral modification plans. Begin by privately sharing what you  have observed about inappropriate behaviors and get a response from the toxic employee. Ideally, that person wasn’t aware of the impact of his or her behaviors and will agree to modify them. Other times, the employee will need to go through the disciplinary procedures set up in your employee manual, up to and including termination.

It isn’t unusual for a practice owner or manager to be reluctant to fire someone, perhaps because this person is the best one in the practice for handling fearful animals, as just one example, or the one who understands your computer system inside and out. But, toxic is toxic and, if that person does not appropriately modify behaviors, your practice, your clients and your patients will continue to be harmed.

#6 Right Size Your Expectations

Sure, you’d like it if you could tell your team to stop being toxic – and then they did. In reality, though, progress is likely to be incremental. After you’ve identified toxic behaviors, and then created and shared policies about expected behaviors, be sure to reward improved behaviors. Focus on making the workplace a more positive and healthy one, and celebrate each step towards that important goal.

Importance of a Practice Culture Audit – and How to Conduct One

If you’ve owned, managed or worked at a particular veterinary practice for any length of time, you may be so used to the workplace culture of the practice that you can’t effectively define it, much less analyze its strengths and weaknesses. If that’s the case, that’s perfectly normal. Having said that, it makes good sense for your practice to conduct a culture audit where you examine the assumptions, values and beliefs shared by people in the practice. This allows you to develop the healthiest culture possible for your practice, where the veterinary practice and individual members of the team can thrive and grow, and where the best service possible is offered to clients and their companion animals.

Organizational culture is comprised of all the elements of the environment of your veterinary practice. This includes the life experiences of each of the employees, along with how these experiences blend together – as well as how they clash. Add to this mix the influence of the veterinarians’ belief systems and life experiences, and the result is the practice’s culture.

People sometimes believe that culture is created through the spoken messages provided, including the policies stated by the veterinarians and the conversations occurring among employees. This is partly true, but culture is largely formed by unspoken messages received about what is valued by the practice. So, to improve the workplace culture, you need to appropriately change messages received by your veterinary team via spoken word but also by observing the behavior of employees at the practice, and determining what is considered acceptable. To change the culture, you’ll need to change the behaviors that are determined to not be acceptable.

For example, your policy handbook may say that gossip about clients is not permitted. But if, in reality, employees roll their eyes about clients and then laugh – and if that is allowed to continue to happen – then your culture is pro-gossip, not anti-gossip, even if no words are spoken.

This example also highlights the importance of performing a culture audit. At its core, a culture audit identifies messages conveyed, and then assesses whether they are the ones you want to be imparting and how consistent/inconsistent they are. This information will help to provide you with the insight you need to develop a healthier workplace culture.

Before You Begin an Audit: Authenticity Matters

As you begin to read more about workplace cultures, you will find ones that you admire – and ones that you don’t. It’s good to be able to identify what you want as part of your own culture (and what you don’t!). But, as the CEO and co-founder of UrbanBound, Michael Krasman, points out in a 2015 article titled Successful Entrepreneurs Understand the Importance of Company Culture, “Be true to who you are. Don’t define your company’s culture by the catchphrase of the day.” He also warns against creating a “grandiose vision and mission” that isn’t true to what you’re actually doing.

Performing a Culture Audit

You can gather information for your culture audit in multiple ways, and it’s more effective if you use more than one information-gathering method. To begin, it makes sense to simply observe your practice. Now that you’ve got a watchful eye, what are you noticing about the messages that are shared among team members and between them and your clients? Are they ones you want to impart?

You can also interview employees of the practice, both individually and as part of small focus groups. You can provide employees with surveys where they can choose to stay anonymous; if someone wants to share information with you but isn’t sure how you’d respond, he or she will most likely feel more comfortable with an anonymous survey.

It often makes sense to hire a consultant to get an impartial observer’s impressions. You are so close to what’s happening in your practice that it may be hard to be objective. This is especially true if your culture needs improved upon, but it can also be true with a practice where the workplace culture is largely positive and effective.

Throughout this process, notice how people are behaving. Note what they do and try to determine why they are doing what they do. What belief systems are driving their behaviors? As just one example, are they not trying to improve processes in the practice because they’re convinced that others won’t change what they’re currently doing? If so, how objectively true is that?

Assess the current procedures. How well do they dovetail with the verbal messages you are giving relevant team members? Perhaps, for example, you are telling your receptionist staff that nothing is more important than the client who is in front of them at the moment. That’s a great message – but if, in reality, you expect the same person to answer the phones while checking in the new clients, how realistic is it for him or her to provide a client with his or her undivided attention?

Take a good hard look at how you are using your finite resources, including time and money, and compare that against your ideal scenario. How close are you to the ideal? Where do disparities exist? Look at how you reward employees, how you develop them as leaders and how you promote them. This is not a comprehensive list by any means, but it should get you started.

Additional Questions to Ask Yourself

Consider what your communication style is, and whether you’re happy with it. Do you simply make announcements and expect your employees to run with it? Or do you solicit feedback and empower employees? What is your risk tolerance? Does your customer service style match your practice’s stated vision and values? How do your customers talk about your practice? Are you happy with what you hear? What is your competition doing well? Not so well?

Where to Go from Here

Once the audit is complete, you can then compare your ideal culture to today’s actual culture, and identify where gaps exist. Once those gaps are identified, then you can begin to create a plan to improve your practice’s culture so that it’s a healthy one, and one that serves the practice itself, the members of the team, and the clients and their companion animals well.

If you’re looking for an experienced professional consultant to help you with your practice’s culture audit, contact us online, email info@veterinarybusinessadvisors.com or call 908-823-4607.

Employee Personnel Files and Records

What types of employee records do you have to maintain?  How long do you have to retain copies of various employee records?  Are there certain documents you need to save longer than others?  Can you keep all employee records in one file?  Should medical doctor notes or I-9 employment eligibility documents be kept in the employee’s “personnel file”?  What about payroll and tax records?  How about correspondence and records generated during an internal investigation?  At what point can you start destroying records?   When and how must documents be destroyed?  Are there specific laws pertaining to document shredding?

The simple answers to all these questions are….. there are no simple answers.  These are some of the difficult questions facing Practice Owners and Practice Managers responsible for interpreting and ensuring proper compliance with the dozens of federal and state laws governing employee records retention.  Most of us realize it would be impossible to retain every employee record forever.  One would need to devote a separate building just to store these records.  While there is considerable debate about how long various employee records should be kept, employers should err on the side of retaining any employee records they think might be needed in future.  It is also advisable to establish a schedule for auditing your Practice’s record keeping, including employee files, as well as a consistent program for records destruction. However, be cautious that even with such a schedule in place, if a discrimination charge or lawsuit is filed against your practice, all records relevant to the charge must be kept until “final disposition” of the charge or lawsuit.  Examples of individual employee documents that may be needed in a lawsuit include:

  • Official Employee Folders
  • Application & hiring records
  • Promotion documents
  • Disciplinary records
  • Performance reviews
  • Training records
  • Payroll records
  • Medical records
  • Polices & procedures
  • Job descriptions
  • Employee grievance & complaint records
  • Job postings/advertisements
  • Supervisor’s notes & records

There are other records and documents pertaining to all employees in the practice that should also be retained, including:

  • Policies prohibiting discrimination & harassment
  • Employee Handbooks
  • Acknowledgements/Receipt of employee handbooks and policies
  • Training records (for all)
  • Decision-making documents

Why Retain Employee Documents

Several statues & regulations require employers to create and/or retain various types of employment records for varying periods of time.  It is interesting, and confusing, to note that requirements for retaining the same or similar records are often required under more than one law.  Unfortunately, the periods of time required to retain this information may vary from federal to state law or between one law and another.  This paradox merely adds to the confusion over how long to retain employee records.  Here is a listing of some of the laws that require employers to retain various employee records:

  • Equal Pay Act (EPA)
  • Fair Labor Standards Act (FLSA)
  • Title VII of the Equal Rights Act
  • Age Discrimination in Employment Act (ADEA)
  • Family Medical Leave Act (FMLA)
  • Employee Retirement & Securities Act (ERISA)
  • Occupational Safety & Health Act (OSHA)
  • Lilly Ledbetter Fair Pay Act (LLFPA)
  • Uniform Guidelines on Employee Selection Procedures (UGESP)
    Reform & Control Act (IRCA)
  • Federal Insurance Contribution Act (FICA)
  • Federal Unemployment Tax Act (FUTA)

Lilly Ledbetter Fair Pay Act

One piece of recent legislation has thrown a “monkey wrench” into figuring out how long to retain employee records.  The Lilly Ledbetter Fair Pay Act, passed by President Obama during his first few days in office, extends the window of opportunity for a current or former employee to bring suit against an employer for perceived discriminatory pay practices.  Lilly Ledbetter, a former Goodyear Tire & Rubber Company employee, filed a discrimination suit against her former employer based on her gender.  Specifically, Ms. Ledbetter claimed Goodyear lowered her performance reviews which resulted in smaller merit increases for years.  This case made it all the way to the US Supreme Court which upheld her claim, but limited the judgment award to discriminatory practices that occurred within the previous 180/300 days.  However, in light of the passage of the Act, employees are now allowed to file suit for discriminatory pay practices that were instituted years prior.  Thus, an employer may now need to produce employee records that go back for many, many years to refute the charge.  If no documentation is available, the practice may not be able to rebut claims or provide an adequate defense for its actions.  This will most likely result in the practice losing the claim and also having to be responsible for attorney’s fees & costs.  Further, some evidence may be excluded without the proper and legal supporting documentation.  Finally juries may think records that are not available would have only supported the claim made by the plaintiff.

What to Do

What does this new law mean for practices and their recordkeeping requirements?  In light of recent legislation, there is no longer a universal answer for how long to keep records.  Each practice should develop its own records retention strategy based upon its own culture, risk tolerance, and available resources.  Since the retention requirements of various laws overlap, employers should err on the side of retaining any employee records they think might be needed in future.  As a minimum, each practice should take the following steps:

  • Develop, examine &/or revise its record retention policies and stick to them; decide how long each piece of documentation should be kept, how it will be stored, and, ultimately, how it will be destroyed.
  • Establish separate files for employee records, as follows:
    • Official Employee Folder-one file for each employee
    • Individual Employee Medical Folder- one file for each employee
    • I-9 Folder-one file for current employees and one for terminated employees by year
    • Health & Safety Training Folder (OSHA)-one file for each employee
  • Review &/or update pay and performance management policies to ensure there are no indications of discrimination or unfair labor practices ensure electronic records policy is consistent w/hard copy records policy.
  • If you retain records electronically, ensure your electronic records policy is consistent with your hard copy records policy since electronic signatures can represent enforceable agreements if they clearly & explicitly deliver terms of agreement.
  • Train managers and supervisors on the new risks of unfair pay practices.
  • Conduct an annual audit of all employee records

Developing a Records Retention Schedule

A records retention schedule will help a practice ensure that it keeps the records it needs, for as long as they may be needed, and then destroys them when they’re no longer useful.  However, you have to know what you have and how long to keep it—legally and for your own business purposes—before you can establish an efficient records management system. That’s why it’s important to inventory your records and develop a schedule.  Here are some guidelines for establishing your own records retention schedule:

Records                                                                                                        # Yrs

Recom: all HR-related records                                                                       6

Any record to support pay diff: men vs women                                          3

Payroll records, incl comp p/week                                                               3

IRS tax-related payroll info                                                                              4

FMLA/USERRA                                                                                                  3 after term

I-9                                                                                                                          3 after DOH

Pension & welfare plan documents                                                               6

OSHA logs & summary of recordable injuries                                              5

Employee exposure to toxic substances, incl MSDS                                  30

Employee workers compensation claims                                                      duration of employment + 30

Resumes & applications                                                                                    1-2

Polygraph test results                                                                                        3

Remember, retaining employee records is something every employer is required to do.  What, how and for how long you save is dictated by law.  While developing and adhering to your records retention policies may be cumbersome, think of it as insurance for your practice.  Without having the proper records, you may become vulnerable to unfounded claims by former employees that could cost you considerable time and money.  That’s why a little effort along the way can save you lots of headaches in the future.