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Schaumburg employment lawyerOwning your own business and being your own boss can be very rewarding, regardless of the field of work. In the United States, there are certain rules and regulations that control how a company should operate, and these guidelines may be different depending on the industry. All companies that operate under the Fair Labor Standards Act are required to keep specific records for a designated period of time for covered, non-exempt employees. Essential documentation may include an employee’s contact information, salary, work hours, and job duties. Record keeping might seem like a basic task, but if it is not done properly, this can lead to significant consequences. An experienced employment law attorney can help a business owner avoid any civil or criminal actions that they could face.

Important Employee Information

For the majority of business owners, their companies are their livelihood. In many cases, the foundation of their success lies in their employees. Therefore, they must make sure to take care of their workers by following standards and procedures that govern their industry. According to the United States Department of Labor, employee payroll information that contains important documents about each employee in your company should be kept for at least three years. Good record keeping practices can help a company maintain a strong reputation, allowing for future growth. Some of the main aspects of employment records should include:

  • The employee’s name, address, and Social Security number
  • The employee’s dates of employment
  • The employee’s regular pay rate (salary or hourly)
  • The amount of wages paid
  • The amount of taxes taken out of an employee’s paycheck
  • The amount of overtime paid
  • The employee’s job duties

Penalties for Negligent Records Management

A comprehensive records management process can help a company operate in an efficient and effective manner. Improper records management can lead to unorganized documentation, the loss of vital information, and stressed employees and employers. If company owners fail to maintain their employment records, they may face criminal charges or civil lawsuits, depending on the circumstances. Poor record keeping can also result in the following consequences:

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Illinois Employment LawyerBeing a business owner can be extremely rewarding and stressful at the same time. You have the benefit of knowing you are running a successful company, but with owning a business comes numerous responsibilities. One of the things you must pay attention to when you own a business is how you keep records, specifically, your employees' records. There are numerous laws and regulations you must follow when you own a business, and there are laws about employee recordkeeping. It is important you comply with these regulations so you do not find yourself in trouble with the government.

Maintaining Personnel Files

A personnel file is one maintained for every employee’s personal information. Items that should be kept and updated in a personnel file include:

  • Employee’s name and personal information;
  • Job applications;
  • Resumes;
  • Employment offers;
  • Emergency contact forms;
  • Documents related to job performance;
  • Any warnings and formal discipline; and
  • Separate documents like exit interviews and resignation letters.

The United States Equal Employment Opportunity Commission (EEOC) states all employee personnel records must be kept for one year after the employee quits or is terminated.

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business law attorneys, employment attorneys Illinois, law firms, business records lawyer, Illinois lawyersEveryone who owns a business, no matter how small or large, must diligently maintain their paperwork. It is important to keep track of items for tax purposes and much more. Decent record keeping can help you monitor the success of your business, keep track of your expenses and assets, and prepare financial statements.

While well-kept records can ensure your business remains healthy, bad record keeping can get you into trouble. Here are four ways you can make things easier for yourself and keep your records in good order:

1. Have a Good Accounting System in Place

Keeping good tax records is much easier when you implement a quality accounting system. If you want accurate tax records, you need proper accounting, and that all starts with the way your records are completed and organized. There is a plethora of accounting software out there that can make the process simple, but it may be a good idea to have an experienced accountant on the job instead.

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Schaumburg record keeping lawyerOwning a small business in the state of Illinois is both exciting and rewarding. Companies in Illinois have many advantages working in their favor, such as a large and diverse marketplace and a robust, skilled workforce. With these benefits comes the responsibility of maintaining a well-functioning workplace for your employees. An employer can build and sustain a better business by adopting proper record keeping practices. Without adequate data recording, vital information frequently becomes lost, resulting in errors that can impact the quality of the work environment and even result in citations and other penalties.

Why Are Records Important?

Record keeping is one of your most important duties as small business owner, regardless of what type of business you own. There are various methods for keeping track of necessary documents, ranging from file folders in a filing cabinet to an electronic or online system. You must compare all of your options and choose the one best suited for your needs.

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Posted on in Employment Lawyer

LauraIf your business is attempting to go paperless and cut down on clutter in the office, it’s important to know what items you’re expected to keep as part of record-keeping requirements and laws for your business. Failing to keep accurate records could land you and your company in a world of trouble, so taking the time to understand your responsibilities makes life (and filing) easier. If you’re involved in any type of legal action or claim, it’s much easier to obtain necessary documents for your attorney if you have already kept them filed properly.

  • Even if an employee has left your company, you need to keep personnel or employment records for a period of one year.
  • Any information regarding employee benefit plans should be kept together for as long as the plan is active and for up to one year after an employee is terminated.
  • Any payroll history must also be kept on file for up to 3 years.
  • Information like merit systems data, wage rates, or any job evaluations should be kept on hand for at least two years. This is largely in place to serve as a reference if there are claims that different sexes were paid with different rates.

It’s important to note that these files should always be kept on hand whether a charge has been filed or not. Putting in place a record-keeping system that works for you is important for ensuring that you’re in compliance with all necessary regulations, but it also makes it easier if an employee or former employee threatens charges against you. Having documentation to back up your side of the story can be tremendously helpful. If you have been contacted by an employee regarding a potential charge or lawsuit, don’t hesitate to retain the services of an experienced Illinois employment attorney.

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1051 Perimeter Drive, Suite 400
Schaumburg, IL 60173
Phone: (847) 995-1205

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