What is a personnel file?

A personnel file is a structured, secure record that details an employee’s relationship with your company from hiring to offboarding. It includes essential documents such as their job application, signed offer letter, performance reviews and records of training or promotions. These files serve as tools for managing compliance, supporting decision-making and ensuring transparency.

Employee files are typically organized into categories to keep information accessible and confidential. For instance, employment records might include resumes, contracts and job descriptions, while performance-related documents can capture feedback, evaluations, promotions and disciplinary actions.

These files are useful when it comes to responding to audit requests, tracking employee development, giving performance reviews or handling disputes with clarity and fairness.

Most employers manage employee documents digitally, using HR software systems or secure cloud-based platforms that facilitate role-based access, encryption, easy organization and automated updates.

Why employment files matter

Employee files are necessary to organize and maintain all the important documents employees accrue over their tenure with a company. They serve many purposes, including:

• Maintaining compliance. State and federal laws may enforce certain employee documents to be kept on file. Those documents have to stay on file for a certain amount of time. Keeping your personnel files organized helps you meet those requirements.
• Providing information in the future. Personnel files can be helpful even after the employee leaves your company. A future employer may request certain information or documentation about a former employee.
• Performance tracking. Employment files create a history of the employee’s performance with your company. They might come into play when deciding on employee promotions and pay raises.
• Improving accountability. Having a documented record of agreements, disciplinary actions, performance evaluations and workplace accommodations contributes to clarity and fairness for both employees and employers.
• Facilitating workforce planning. Detailed records of employee skills, training, achievements and certifications help you identify gaps, plan team development and make informed decisions about future hiring.

Common employee personnel file documents

Here are some of the most common documents found in a personnel file:

• Employment application
• Resume
• Cover letter
• Tax forms
• Education verification
• Employment verification
• Job description
• Job offer letter or contract
• Orientation checklists
• Other training documentation
• Official forms such as promotion requests
• Employment agency paperwork when relevant
• Formal feedback
• Employee handbook receipt
• Self-evaluations, manager evaluations and other assessments
• Any documentation of disciplinary action
• Recognition for achievements
• Attendance and leave records
• Termination documentation, including resignation letters, exit interview records and end-of-employment checklists
• Any other documents related to the employee’s job

How to choose what you put in an employee personnel file

To learn which specific papers belong in an employee file, these guidelines may help:

• Relevant to the employee’s role: The paperwork in this file should always relate to the job itself. This can include job applications, resumes, job descriptions and performance evaluations.
• Supports employee development: Include records that help track the employee’s career growth, such as training certifications, project achievements, outstanding client feedback or performance reviews.
• Legal and compliance requirements: Depending on laws in your area, you may need to include documents that ensure the company complies with employment laws.

Considerations for creating employee files

Creating employee files requires a thoughtful approach to keep records secure, accessible and organized. Start by selecting a storage method that suits your needs and supports efficiency.

Digital storage is often preferred for its sustainability, cost-effectiveness, secure backup options, real-time accessibility and reduced reliance on physical space. If you choose physical storage, ensure files are kept in a secure, locked cabinet located in a restricted area and protected from environmental damage such as water or fire.

Each employee should typically have their own individual file. For existing employees, locate the various documentation you need and move it to each person’s file. For new hires, refer to your new hire checklist to ensure all documentation is completed correctly and added to their file. Consistent labeling practices, detailed indexing and a clear structure further enhance the ease of managing these files.

To maintain accuracy, establish a retention policy that meets legal requirements and aligns with company operations. Conduct regular reviews to update files, remove outdated documents and incorporate new information, such as certifications or policy acknowledgments. A well-maintained system keeps records accurate and supports organizational efficiency.

9 best practices for employee personnel files

Creating and maintaining employee files helps you stay organized and protects your business. Following best practices keeps personnel files secure and compliant with legal standards.

1. Develop a clear personnel file policy

Start by creating a written policy that defines how you manage personnel files. Outline what documents belong in the file and specify what should be stored elsewhere.

Include a detailed timeline for how long different types of documentation should be retained, referencing federal, state and industry-specific guidelines. Clearly explain the file disposal method and consider addressing security protocols for file storage.

2. Conduct regular file reviews

Schedule regular reviews of personnel files to keep them organized and current. During these reviews, check for outdated documents that no longer need to be retained and confirm that all required paperwork is included, accurate and updated. For example, verify that new certifications, completed training programs or updated contracts have been added, along with any performance-related feedback or policy changes.

3. Organize files with a logical system

For digital systems, use tagging or folder structures to group related documents and allow for efficient retrieval. Physical files should be arranged in labeled folders within a secure filing cabinet, with indexes to locate information quickly.

Consider implementing a coding system for retention periods, marking documents with the year they are eligible for disposal, their compliance category or their priority level. Clear and precise organization simplifies annual reviews and helps you stay on top of legal retention requirements.

4. Summarize file contents for inactive employees

When employees leave your company, their personnel files become inactive but may need to be retained for a specific period. Create a summary sheet to catalog the contents of the file, noting the retention period for each document, the reasons for retention and the document’s location.

Summaries make it easy to find records when you need to, such as proof of employment, reference material, past evaluations or signed contracts, without searching through every file. A well-maintained summary sheet also simplifies audits and any future legal inquiries involving former employees.

5. Prioritize confidentiality

Protecting the privacy of employee records helps you maintain trust and comply with regulations. Store physical files in locked cabinets located in secure areas and use digital systems with encryption, password protection, role-based access and multifactor authentication.

Limit access to personnel files to HR personnel and authorized managers and train your team on confidentiality protocols to reduce risks. Avoid storing sensitive information and establish a secure process for file transfers or sharing during audits or management reviews.

6. Use digital storage and backup systems

Digital file management offers substantial benefits, including space savings, enhanced accessibility and improved security. Consider a system that includes encryption, two-factor authentication, audit trails and customizable access levels to protect sensitive records.

Regularly back up your digital files to secure locations to avoid data loss from cyberattacks, system failures, manual errors or accidental deletions. Digitizing physical files and integrating them with digital records reduces redundancy and supports sustainability goals by decreasing reliance on paper.

7. Include professional development records

While employee files traditionally focus on compliance and employment history, incorporating professional development records adds value for the employee and your organization.

Track achievements like completed training programs, certifications, promotions, leadership projects and awards to document their growth. These records can be referenced during performance reviews, when considering raises or promotions or when planning workforce development strategies.

8. Create a centralized access system

If you use digital storage, establish a centralized platform where authorized personnel can access relevant files. Your system should feature role-based permissions, allowing HR staff and managers to view only the documents they need.

What’s more, centralization streamlines the process of retrieving records and reduces duplication. For physical systems, maintain a single, locked location for personnel files and use a clear check-out process to track when people access employee files.

9. Train your team

Equip your HR team and managers with the knowledge they need to handle personnel files responsibly. Training might cover retention policies, confidentiality requirements, inclusivity in documentation and best practices for digital and physical storage.