CHAPTER 13Record keeping
Every business must retain certain records on their current and past employees, but which ones and for how long?
On the federal level, there are two agencies that regulate record keeping. First is the IRS, which is responsible for enforcing the Internal Revenue Code. The second is the US Department of Labor (DOL). The Wage and Hour Division of the DOL is responsible for enforcement of the Federal Fair Labor Standards Act (FLSA), the Family and Medical Leave Act (FMLA), the Immigration Reform and Control Act (IRCA), and the laws governing wages paid by federal government contractors.
Both of these agencies have separate rules regarding the type of records that must be kept and the length of time you must keep the records. To further complicate your requirements, there are numerous state, local, and other regulatory agencies that may require additional record keeping. State agencies enforce state unemployment insurance tax acts, state wage and hour laws, child support and creditor garnishment laws, and unclaimed or abandoned wage requirements.
Keeping these records accurate and up to date is extremely important to the health of your business. Without the proper records, you will be unable to meet regulatory requirements should you be audited by any of various federal state and local agencies. Failing to meet these requirements can mean large penalties and the potential for large settlement awards should you be unable to provide the required information ...
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