Published: Sunday, September 14, 2008
Finance Q&A: Personal data from past employer
Question: What happens to the personal information my employer has after I leave the company?
Answer: These days, employers have a host of information on employees including medical and health insurance records, information in pension and 401(k) plans and bank account numbers from direct deposit.
Most companies keep this information long after an employee's termination to comply with various federal regulations, said Charles Knapp, a partner at the law firm Faegre & Benson LLP in Minneapolis.
For example, Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination, requires a company to retain employment application records for two years after an employee leaves. As a general rule of thumb, companies typically keep personnel and employee benefit files between one and five years and payroll records for three years, Knapp said.
As for the destruction of these files, there is no federal law that regulates how and when an employer needs to delete this information, said Don Harris, president of consultant HR Privacy Solutions Ltd. in Delhi, N.Y.
However, many states have some type of records disposal law that requires employers to create a procedure for the proper disposal of documents containing personal data, he said.
In general, record-keeping and disposal practices vary widely from employer to employer. The more responsible companies will archive the information in backup files that are not easily accessible. Others, though, may keep it in current files, which could be susceptible to hacking.
When the employer gets rid of the information, all paper documents should be shredded or burned and electronic files, destroyed.
Smaller businesses or those facing bankruptcy pose the greatest risks, Harris said. They often don't follow any specific procedures and many throw these documents out like regular garbage, available to anyone snooping through the trash.
Associated Press
Answer: These days, employers have a host of information on employees including medical and health insurance records, information in pension and 401(k) plans and bank account numbers from direct deposit.
Most companies keep this information long after an employee's termination to comply with various federal regulations, said Charles Knapp, a partner at the law firm Faegre & Benson LLP in Minneapolis.
For example, Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination, requires a company to retain employment application records for two years after an employee leaves. As a general rule of thumb, companies typically keep personnel and employee benefit files between one and five years and payroll records for three years, Knapp said.
As for the destruction of these files, there is no federal law that regulates how and when an employer needs to delete this information, said Don Harris, president of consultant HR Privacy Solutions Ltd. in Delhi, N.Y.
However, many states have some type of records disposal law that requires employers to create a procedure for the proper disposal of documents containing personal data, he said.
In general, record-keeping and disposal practices vary widely from employer to employer. The more responsible companies will archive the information in backup files that are not easily accessible. Others, though, may keep it in current files, which could be susceptible to hacking.
When the employer gets rid of the information, all paper documents should be shredded or burned and electronic files, destroyed.
Smaller businesses or those facing bankruptcy pose the greatest risks, Harris said. They often don't follow any specific procedures and many throw these documents out like regular garbage, available to anyone snooping through the trash.
Associated Press
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