Retention Period for Personnel Files Versus Deletion Period: What Applies?
Personnel files are extremely sensitive, because they contain employees’ personal data. The retention periods for these data are legally clearly defined. But which period applies to which part of the file? And how can HR employees maintain an overview? Here we give you a summary of the most important legal storage obligations.
The various retention periods of personnel files
Retention period for application documents: three months
The retention period for applicant data is three months after the conclusion of the application process, because according to the Equal Treatment Law there is the possibility of an objection. If there is an objection, the human resources department must, of course, retain these data until the objection process is finished. Furthermore, application documents may be stored in an applicant pool if there is written agreement to that. As a rule, application documents go through an examination workflow. Here, too, the persons responsible absolutely must make sure to document this and to delete the data from the workflow after the end of the purpose.
Retention period for personnel files: three years
If an employee leaves the company, the personnel file must be retained for three years in order to satisfy any claims, such as a request for a letter of reference. The period is calculated from December 31 of the year in which the employment contract ended. It is possible that parts of the personnel file will be retained which are subject to regulations of tax law, social security law and employment law, because the human resources department individually determines the contents of the file. Longer retention periods apply here.
Tax law retention period for personnel files: six years
If external payroll tax audits are pending, tax auditors require access to the parts of the personnel file which are relevant to tax law (EStG § 42f.). They determine if the employer has properly paid social security contributions and church and payroll taxes. Therefore, documents such as pay slips, tax cards and documents for wage tax deduction may only be deleted after six years.
Before disposing of personnel files, managers absolutely must check if wage records which are used for determining profit are included. There is a ten year retention requirement for these.
The digitization of personnel files supports the personnel department in automatically meeting important deadlines and dates.
Social security law retention period: five to 30 years
In this case, the Social Security Code is required. The social security law retention period includes contribution calculations and statements of the all-risk insurance contribution. For wage statements about work hours and wages paid in personnel files, there is a retention period of five years. The company pension plan, on the other hand, has a special status. The retention period for wage records, six years, applies. Unless former employees do not claim a company pension within six years, in which case the retention period is 30 years.
Digitization provides an overview of personnel files
The many different legal regulations, but also internal rules, present the human resources department with tremendous challenges. If personnel files are still on paper, they must be regularly reviewed and checked after expired retention periods – manually. Paper files are usually distributed in companies, with some data even in different departments. The digitization of human resources processes can be one solution for easily managing the observance of retention and deletion period easily. Digital personnel files provide clarity, need less storage space and save time and money in contract management. All employee data and the associated documents are stored centrally in a file. Furthermore, human resource managers can automate deletion periods by defining deletion concepts in the HR management system for the different requirements. That way, data protection is easily implemented and becomes part of the daily process in human resources departments.