Every time we undertake the defense of a discrimination charge or lawsuit filed by a current or former employee, one of the first things we do is ask our client for a copy of every piece of paper, e-mail message and computer file they can find that has to do with their relationship with the employee. What makes us the happiest is when our client sends us documents that we can use to demonstrate to the government, the court, or the jury that the company has adopted basic employment policies, has been conscientious in the hiring process, has monitored the employee’s performance, and, if there were conduct issues, has taken steps to correct them.
Employers, no matter how small, that do not keep basic employment records will face a greater challenge in defending claims by employees than those who do. In Delaware, employers who have as few as four employees can be sued in state court for discrimination!
Even if you don’t have a Human Resources Department and feel that you are too busy to fool around with what you might think of as useless and time-consuming paperwork, you will do yourself a big favor if you use, at the very minimum, the following:
1. An employment application
2. An employee handbook
3. Performance evaluations
4. Disciplinary action forms
You should also keep in mind that certain documents are legally mandated, including I-9 forms, state and federal employment law posters, and tax documents such as W-4 forms. I would also recommend that you make a photocopy of each employee’s social security number card to avoid problems with mismatched social security numbers. Using these basic documents will help you avoid liability for discrimination, hiring illegal aliens, and hiring employees who harm others, and may help you reduce the number of successful claims for unemployment compensation benefits.