Employee Document Management: How To Set It Up Right

September 1, 2023

employee document management

The human resource department is often home to complex documents that contain sensitive information.

These files can be unorganized inside a filing cabinet filled to the brim with employee records. Or they can be kept safely, securely, and well organized, thanks to an employee document management system.   

Effective employee document management through HR case management software makes it easy to search, store, and manage all employee data. This way, if you need to access a file or an employee record, you can find it fast without sifting through an endless amount of paperwork.

How to set up employee document management

Creating an employee document management strategy is easy once you know the necessary steps. Here’s how to get started.

1. Determine the necessary documents

First, identify the files and records your business collects. The documents are usually related to the HR functions the department handles.

These necessary HR documents are typically:

  • Recruiting files: Anything related to interview notes, job descriptions, applications and resumes, and pre-employment testing results.
  • Safety and accident report: Paperwork detailing medical records, workers’ compensation, and incident reports.
  • Hiring documents: Records related to onboarding a new employee, employment contracts, and I-9s.
  • Employee records: Signed employee handbooks, policy changes, noncompete agreements, personnel files, or defined HR policies.
  • Training materials: Records and resources related to employee training programs.
  • Payroll documents: Attendance records, tax forms, time sheets, and paystubs.
  • Leave documents: Requests pertaining to paid time off, sabbaticals, or paid parental leave.
  • Benefit documents: Information regarding plans, enrollment documents, and various offers.
  • Disability records: Leave request forms, disability information, and requests for specific accommodations. 
  • Employee files: Anything related to performance reviews, compensation records, unemployment records, and promotion documents.

2. Define access restrictions

Some HR documents are confidential or need restricted access to specific employees. As you organize files, you’ll want to define access needs. 

To control access over records, consider whether all employees, managers or just the HR department needs to access the documents. You can also determine permissions by when and how often these people are likely to need those files. Additionally, consider how you’d like these individuals to gain access to these specific documents.

3. Identify expiration of information

As a busy HR professional, it’d be helpful to just create one document one time and be done with it.

That usually isn’t the case, as sometimes the data within these files have expiration dates. Additionally, sometimes it’s up to the human resource team to keep documents for a specific amount of time before they become null and void. As you go about setting up employee document management, consider going through which files have expiration dates and set up reminders for when they expire. Case management can also help determine the beginning and end of a specific issue.

To identify expiring files, ask the following:

  • Is the organization required to keep certain files under the law?
  • How long are you required to keep these files?
  • Are there events that could trigger disposing of a document altogether?
  • Is there any legal liability to keeping files after they expire?

4. Determine security levels

As you streamline the document management process, you’ll find some records need more security and protection than others. For example, some information in these files may be protected by law, like medical and disability information that needs to be kept separate from employee file folders.

Additionally, if a document has expired or no longer has to be kept by the organization, how can it be discarded? Some files, like out-of-date training documents, can simply be thrown away. Ones that contain personal information about a past or current employee should be shredded. 

5. Create a plan for storage and archiving files

Once you have a better understanding of the security your files need, you can move forward with file management. You’ll want to determine which files will remain as paper copies (like ones you'll eventually need to shred) and which ones can be stored digitally. If you can go completely paperless, this may be the easiest option.

You can then decide how to group files. For instance, employees may have access to a library of resources with key information about insurance or taxes, while managers and team leads can access employee records. 

6. Utilize software

When your organization takes time to find the right HR service delivery software, it’s easy to utilize this tool to simplify employee document management. All of the files you need will be in one place, making it easy to set parameters, restrictions, and security settings for the records that need it most.

Benefits of an employee document management system

No matter your organization or industry, there are many benefits to implementing an employee document management system within your HR team.

Remain compliant

One of the main benefits of a document management system for HR files is it allows an organization to remain secure and compliant. These systems make it easy for human resources teams to see what documents are on file, missing, out of date, or in compliance. Having a comprehensive document storing system helps ensure your organization complies with all of the relevant requirements.

Legal protection

When it comes to your overall business needs, you always want to remain within the constraints of the law. With numerous federal laws requiring employers to store certain employee records, utilizing software with employee document management is an absolute must. In addition to these federal requirements, you must be able to readily access employee documents to answer certain lawsuits, regulatory audits and inquiries, and employee complaints. 

As an example, if an employee files a discrimination complaint against your organization, it’s likely HR will need to reference past performance appraisals, compensation data, and attendance records. If the complaint turns into a legal investigation and involves the Equal Employment Opportunity Commission (EEOC), the HR team can utilize these records to protect the organization from a lawsuit.

Maintain security and privacy

Certain employee records have to be stored securely, while others have specific retention periods, so it’s best to keep all of these in one place. Employers are legally required to secure sensitive employee data, like files pertaining to medical information, details about disabilities, social security numbers, and other personal information.

Having an employee document management system in place will have security protocols that meet these legal requirements. 

Features in a document system related to security and privacy typically include:

  • Locking physical files
  • Securing computers and other equipment when not in use
  • Protecting electronic data with passwords and encryption settings

Increase HR productivity
HR departments are more productive when they can easily search for documents and improve employee file consistency. They’ll be able to spend less time searching through filing cabinets or boxes full of unorganized documents and spend more time doing their day-to-day role, like managing employee relations.

For example, imagine the time and effort that goes into managing employee tasks such as internal transfers or relocations. Ensuring all their files are in one place can help make move management an even simpler process.

Improve workflow

Automating the process of turning paper files into electronic documents improves the workflow of the HR department, as well as other managers and C-suite executives. No matter when an important employee record is needed or when changes must be made to benefits administration policies, doing so can be done quickly and efficiently.

In addition to improving the workflow of the HR team and other managers, having these files safely organized and stored within a cloud-based document management system makes it easy for employees to access the documents they need without having to ask the HR team for assistance.

Challenges of an employee document management system

On the flipside, implementing an employee document management system comes with some challenges. One of the main challenges is the training process that goes hand-in-hand with utilizing a new process for the first time. In addition to investing in this new software, you’ll also need to invest time and effort into training your staff on how to use it in a compliant and secure fashion.

Depending on the tool your business opts for, it can also take time to move from paper to paperless files. It will take some getting used to and will need to be fully ramped before the benefits can be enjoyed.

Moving towards a digital workplace

Stop spending hours hunting down important employee files and take advantage of employee document management. You’ll find yourself asking, “where did I put that piece of paper?” a lot less and instead have more time to focus on making sure the right processes are in place for success.

Once you have all important files within your employee document management system, see how else you can improve your organization's HR compliance.

hr case management software
File storage, simplified

Utilize HR case management software to streamline how your organization manages all employee documentation.

hr case management software
File storage, simplified

Utilize HR case management software to streamline how your organization manages all employee documentation.

Employee Document Management: How To Set It Up Right Employee document management is the process of retaining, organizing, and destroying files. Learn how to set it up effectively and the benefits it offers. https://learn.g2.com/hubfs/G2CM_FI090_Learn_Article_Image-%5Bemployee_document_management%5D_V1d.png
Mara Calvello Mara Calvello is a Content Marketing Manager at G2. She graduated with a Bachelor of Arts from Elmhurst College (now Elmhurst University). Mara's expertise lies within writing for HR, Design, SaaS Management, Social Media, and Technology categories. In her spare time, Mara is either at the gym, exploring the great outdoors with her rescue dog Zeke, enjoying Italian food, or right in the middle of a Harry Potter binge. https://learn.g2.com/hubfs/IMG_6361.jpeg https://www.linkedin.com/in/mara-calvello-83648b47/

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