Global Labor and Employment Law Strategic Topics - Employment documentation management globally - EY

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Global Labor and Employment Law Strategic Topics - Employment documentation management globally - EY
Global Labor and
Employment Law
Strategic Topics
Employment documentation
management globally

2019 Edition #2
Global Labor and Employment Law Strategic Topics - Employment documentation management globally - EY
Global Labor and Employment Law Strategic Topics - Employment documentation management globally - EY
In this issue, we focus on:
employment documentation
management globally
Editorial        5    India                     24

Albania          6    Italy                     26

Argentina        7    Lithuania                 27

Australia        8    Mexico                    28

Belgium          9    Netherlands               29

Brazil           10   New Zealand               30

Bulgaria         11   Peru                      31

Canada           12   Poland                    32

Colombia         13   Portugal                  33

Costa Rica       14   Russia                    34

Czech Republic   15   Serbia                    35

Estonia          16   Singapore                 36

Finland          17   Slovakia                  37

France           18   Spain                     38

Georgia          19   Sweden                    39

Germany          20   Switzerland               40

Greece           21   United Kingdom            41

Guatemala        22   Contacts for Labor &      42
                      Employment Law Services
Honduras         23
                      Recent EY publications    44
Hong Kong        24
Global Labor and Employment Law Strategic Topics - Employment documentation management globally - EY
Global Labor and Employment Law Strategic Topics - Employment documentation management globally - EY
Editor’s letter
Companies operating cross border with employees around the world are facing increased
challenges to ensure compliance with the various labor and employment law documentation
and retention requirements.

Global organizations often have difficulties ensuring that documentation is properly managed
and retrievable by the right people at the right time and for the right reasons.

Moreover, the GDPR requires companies to allow employees access to the information and
documents retained by the employer concerning them in order to verify the accuracy, and
request correction or erasure.

In this edition of our EY Global Labor & Employment Law hot topics guide, we focus on the
rules for employment documentation and management across 36 jurisdictions.

EY’s legal advisory and managed services teams not only advise companies on compliance
with these legal rules; we also assist companies in setting up systems to easily process, store
and retrieve documentation in compliance with those rules.

Roselyn Sands                                         Paula Hogéus
EY Global Labor & Employment                          EY Global Labor & Employment
Law Markets Leader                                    Law Leader
roselyn. sands@ ey-av ocats. com                      paula. hogeus@ law. se. ey. com
Global Labor and Employment Law Strategic Topics - Employment documentation management globally - EY
Albania                                                                                                                   Soena Foto

Employment documentation                           However, in a fast-paced technological         Employees have the right to be informed
                                                   working world, where outsourcing and           about their personal data being processed
                                                   cloud computing of personal data are           and to request from their employers the
As a general principle, personal data              widely used — enhancing business agility       following:
should be collected by employers at the            and accelerating change for all industries     • Information
                                                                                                                 free of charge regarding the
amount needed to fulfill legal obligations         worldwide — new challenges arise for               processing’s scope, the categories of
imposed by the labor legislation and               employers as data controllers.                     processed data and the data receivers
individual or collective contracts.                From a data-privacy perspective,               • Blocking,
                                                                                                               correcting or deleting his or
In addition to the personal data that is           the allocation of responsibilities, the            her data, free of charge, whenever the
traditionally expected to be processed in          applicable data-privacy obligations and            employee becomes aware that such data
the employer-employee relationship, such           rules for cross-border transfers of data           is incorrect, untrue, incomplete or has
as contact details, salaries and leaves,           remain major challenges. Pursuant to               been gathered or processed in violation
employers also process data about their            the Commissioner on Data Protection,               of the law
employees as part of their day-to-day              the data controller cannot transfer
                                                                                                  In conclusion, personal data security is a
working lives. In this respect, one of the         personal data outside of Albania or to
                                                                                                  very important aspect of modern human
main challenges that employers face                countries other than European Union
                                                                                                  resources management and is certainly
while gathering and processing personal            Member States, in the cloud, without
                                                                                                  not to be taken lightly. Employers need to
data is data management — i.e., keeping            obtaining preliminary opinion from the
                                                                                                  ensure they conduct adequate periodic
such data confidential and safe without            Commissioner.
                                                                                                  due-diligence controls on the security,
exceeding timelines specified by the law.          With respect to the retention period of        retention and erasure of data when it is
Employers are obliged to protect the               personal data, generally such data should      no longer required. It is fundamental for
confidentiality of an employee’s personal          be retained until the termination of the       ongoing compliance and reducing risk of
data and should not disclose such                  employment relationship. Employers may         exposure.
data unless required by the applicable             process personal data in excess of such
legislation. Employers should implement            terms only upon consent of the employee.
an information security management                 However, certain personal data, such as
system based on the identification,                salaries and other work-related benefits,
analysis and mitigation of potential risks         personal income tax, social security and
imposed on the security of personal data.          health contributions paid for employees,
Further, personal data should be held in           should be kept for a period of five years as
private physical or electronic files. Special      a requirement of the tax legislation.
measures should be implemented for                 Regarding work-related accidents and
the security of sensitive personal data            illness, employers should keep a separate
(i.e., race, ethnicity, health and sexual          registry that should be kept for a period
life). This includes keeping files separate        of five years. After the lapse of such term,
and allowing access only to authorized             the registry is archived at the Regional
persons.                                           Directory of Social Security.

                                                                                                  Soena Foto

6   Employment Documentation Management Globally
Global Labor and Employment Law Strategic Topics - Employment documentation management globally - EY
Javier Sabin                                                                                                 Argentina

Employment documentation                      Even more, the term for an employee            place of work a certified copy of the
                                              to claim payment of the applicable             documentation that, according to law,
                                              retirement fund or pension with the            should be there.
In Argentina, information backup is           Argentine Government does not become           Moreover, the Federal Public Revenue
key to safeguarding employers from            statute-barred; therefore, employers           Agency (AFIP) deployed the digital wages
employee claims in labor courts. Thus, as     should keep documentation related              and salaries book system to replace
established in section 143 of Employment      to pension fund contributions during           physical forms. This new tool provides
Contract Law (ECL) No. 20,744, “The           the effective term of the employment           safe information storage to avoid issues
employer shall keep receipts and other        relationship. Once it is concluded, the        concerning information loss, destruction
payment vouchers during the term              employer should provide the employee           or theft, and the lack of physical space
in which the statute of limitations is        with the related documentation and             available to keep such documentation.
applicable for the relevant benefit.”         certificates.
                                                                                             Finally, over the past few years, labor
The statute of limitation is two years.       In our opinion, the salaries and wages         authorities allowed the preparation of pay
Regarding social-security matters,            book (section 52 of the ECL) should be         slips digitally, replacing paper, which was
section 16 of Law No. 14,236 determines       kept indefinitely. The remaining labor and     gladly welcomed by many companies.
that “legal actions to collect employer       social-security documentation (signed
                                                                                             Yet, at the height of the 21st century,
contributions, employee contributions,        pay slips and file documents, among
                                                                                             employers still need to keep labor
fines and other obligations arising from      others) should be kept indefinitely.
                                                                                             documentation in physical format,
social security laws will be statute-barred   However, should it not be possible, we
                                                                                             incurring storage costs and hours of their
after 10 years.” Section 24 of Law No.        believe that it would be reasonable to
                                                                                             own or third-party resources to manage
23,660 establishes the same 10-year           keep the documentation for 20 years
                                                                                             these tasks. However, we are seeing that
term for legal actions related to statutory   considering the statute of limitations for
                                                                                             regulations are slowly moving toward an
health care organizations. Therefore,         social security purposes and the maximum
                                                                                             electronic document-management system
documentation should be kept for              term of a labor-claim interruption.
                                                                                             to meet legal requirements.
this period.                                  Regarding the place where such labor
However, since these terms may be             documentation should be kept, please
altered by the suspension or interruption     note that employers performing their
of the statute of limitations (for example,   activities in more than one jurisdiction
an interruption of a labor court claim is     may opt to centralize official labor
possible during years of proceedings,         documentation in the entity’s legal
provided they do not exceed the statute       domicile or at its main place of business,
of limitations period), we believe that the   provided that at least 20% of the
term during which payroll documentation       company’s personnel actually work in the
should be kept could be much longer than      jurisdiction. However, such centralization
10 years.                                     requires that the employer has at each

                                                                                             Javier Sabin
                                                                                             Sebastián Calciati

                                                                                           Employment Documentation Management Globally   7
Global Labor and Employment Law Strategic Topics - Employment documentation management globally - EY
Australia                                                                                                              Andrew Ball

Employment record-keeping                          What employment records must                  Conclusion
obligations in Australia                           employees be given access to?
                                                                                                 Employee record-keeping is a key
In Australia, employment documentation             Employers must provide employees              compliance consideration for any
management is primarily regulated under            access to pay slips in either hard copy or    employer engaging workers in Australia.
federal workplace laws. The Fair Work Act          electronic form within one working day of     Failure to comply with a record-keeping
2009 imposes significant record-keeping            paying an employee for the performance        obligation under the act will subject
obligations on employers who engage                of work. Furthermore, former and current      employers to a risk of prosecution from
employees under the national workplace             employees are entitled to request the         the Fair Work Ombudsman (FWO) and,
relations system.                                  employer to provide a copy of their           in the most serious cases, significant
                                                   employment records.                           civil penalties up to $126,000 for an
What types of employment records                                                                 individual and $630,000 for corporations.
                                                   Where there is a transfer of business,
must be kept?                                                                                    Furthermore, in proceedings for
                                                   the old employer must provide the new
Under the act, employers must keep                 employer with employee records in             contraventions of the act and industrial
records for each employee with basic               relation to all transferring employees.       instruments, the onus of proof will be
employment details, including pay,                                                               reversed, and the employer must prove
                                                   What record-keeping obligations               the contravention did not occur.
overtime hours, averaging arrangements,
                                                   are applicable to industrial
leave entitlements, superannuation                                                               However, besides the significant sanctions
contributions, termination of employment,                                                        for noncompliance, the courts have also
individual flexibility arrangements and            Industrial instruments are legal              emphasized the importance of record-
guarantees of annual earnings.                     instruments that set out minimum              keeping for the enforcement of workplace
                                                   entitlements for certain groups of            laws. To ensure compliance with record-
How must employment records
                                                   employees. Employers need to be aware         keeping obligations, it is best practice for
be kept?
                                                   of any industrial instruments (i.e., modern   employers to maintain accurate and up-to-
Employment records must be in English              awards or enterprise agreements) that are     date records in the event of an inspection
(preferably plain, simple English) and             applicable to its workplace or employees.     by the FWO and implement adequate
kept by the employer for seven years.              In addition to the record-keeping             systems (e.g., a physical document-
Records may be held either physically or           obligations under the act, industrial         management system, electronic database
electronically in a location convenient            instruments will often prescribe additional   or cloud storage) so that employment
to the employer. However, employers                record-keeping obligations. For example,      records can be made readily available.
must ensure that a copy of an employee             modern awards, which cover employees
record can be made readily available               within a specific industry or occupation,
in a legible form for inspection and               will generally impose an obligation on the
copying if requested by a former or                employer to ensure copies of the award
current employee, a Fair Work Inspector            are available to all employees.
or an organization official (such as a
trade union).

                                                                                                 Andrew Ball
                                                                                                 Michael Starkey

8   Employment Documentation Management Globally
Global Labor and Employment Law Strategic Topics - Employment documentation management globally - EY
Yasmina Benali                                                                                                  Belgium

Managing employment                            for a term of five years.                        Collective labor law
documentation                                  The employer can keep the social
                                                                                                Collective labor law documents are less
                                               documents in any form of reproduction,
Introduction                                   provided they are clearly legible and that
                                                                                                The Law on Collective Bargaining
                                               the form of reproduction used allows
Belgium has had legislation regarding                                                           Agreements and Joint Committees (5
                                               effective supervision.
employment documentation storage                                                                December 1968) stipulates that every
for decades.                                   A simplification of this legislation
                                                                                                collective bargaining agreement (CBA)
                                               came into being via the decree on the
Employment documents                                                                            must contain a reference to its period of
                                               introduction of an immediate declaration
                                                                                                validity. Further elaboration on how long
The foundation of this legislation can         of employment (5 November 2002).
                                                                                                (or where) CBAs must be retained does
be found in Royal Decree No. 5 (23             This declaration, referred to as DIMONA,
                                                                                                not exist.
October 1978), referred to as the Law          replaces several social documents and
                                                                                                Social bodies, such as the works council
on Social Documents. This decree lays          allows the employer to communicate all
                                                                                                and health and safety committee, do have
out which documents are considered to          data on employment, wages and working
                                                                                                the obligation to record meeting minutes.
be social documents and therefore must         hours to a single unified body for the
                                                                                                The law also states that the bodies
be kept by the employer. Examples of           collection of social-security contributions.
                                                                                                themselves determine how archives
social documents include the general           Later, the Law of 3 June 2007 gave
                                                                                                should be retained in their internal
and specific staff registers, individual       legality to the sending and electronic
                                                                                                house rules.
accounts, the attendance register,             archiving of certain social documents,
the working-time register and specific         such as individual accounts and pay slips.       Thoughts and leadership
employment contracts. Note that not all        Employees must, at all times, be able to         The introduction of the so-called DIMONA
employee documentation and related             have access to the electronically archived       meant a big leap forward in simplifying
obligations are covered in this decree.        documents. Contrarily, no legal text exists      employment-documentation obligations
Specific documents, e.g., the overtime         around the consultation of paper social          and facilitating digitalization. In 2007, new
register and the control document for          documents by the employee. Yet we can            steps were taken. It can be considered
part-time employees, are not covered by        assume that other forms of reproduction          a positive thing that digitalization must
the decree but are nonetheless documents       should be accessible as well.                    happen in mutual agreement. That
that should be kept by the employer due to
                                               It is crucial to note that, following            way all employees have access in their
provisions in specific legislation. Specific
                                               the changes that the Law of 2007                 preferred form. On the other hand, we can
provisions also apply to an employee’s
                                               implemented in the Law on Employment             ask ourselves whether this slows down
posting. Belgian employers working with
                                               Contracts (3 July 1978), both employer           effective progress. Should electronic
personnel hired abroad but working in
                                               and employee must agree that                     documentation be the default position?
Belgium benefit from certain exemptions.
                                               documents will be kept electronically.           In these rapidly changing times of the
The decree and specific legislation            There is, therefore, a double element of         digital age, the constant need for updates
prescribe the options as to where these        voluntariness: the employer cannot be            is always around the corner.
documents must be kept. This can be at         obliged to send documents electronically
the address under which the employer           and the employee cannot be forced
is registered at the National Social           to use documents sent electronically.
Security Office (NSSO), at the employer’s      As a result, we can conclude that
residence, or at the headquarters when         written documentation (or non-
the latter is in Belgium.                      electronic documentation) remains the            Karla Vuyts
In general, social documents must be kept      starting point.                        
                                                                                                Yasmina Benali

                                                                                              Employment Documentation Management Globally   9
Brazil                                                                                                       Tatiana Carmona

Employment documentation                          Some documents may require a 20-year          The electronic reporting implemented by
                                                  period of retention, such as the Social       the Government starting in 2018 played
                                                  Security Professional Profile (PPP) and       an important role in how companies
Legislation overview                              Occupational Health Medical Control           formalize and retain employment contract
                                                  Program (PCMSO), both related to health       information. Some documents, which for
In Brazil, employers are subject to comply
                                                  and safety.                                   years were kept only in paper, have now
with a series of obligations regarding
                                                  And finally, documents regarding              been inserted into a digital system. This
employment contracts for both labor and
                                                  severance fund (FGTS) payments must           has helped companies centralize and have
social security purposes. Such compliance
                                                  be kept by the employer for 30 years,         better control of information. Yet there
requires assessing the document’s nature
                                                  according to the law. However, the            are several documents that are still not
and purpose.
                                                  Supreme Federal Court has decided that        part of the electronic reporting so far.
Employers are required to formalize and
                                                  the statutes of limitation for queries        In relation to where this information
retain documentation of employee’s
                                                  regarding FGTS is five years.                 should be stored, there is no specific law.
payroll, ancillary obligations related to
                                                  If the employer does not keep employment      Companies may opt to store digital data
payroll taxes, health and safety issues in
                                                  contract documents retained for the           in an internal server or in the cloud. It will
the workplace, and work shifts, among
                                                  necessary period, a penalty may be            depend on the internal data policy.
                                                  applied for the absence of the document       Paper documents are usually kept
Documents retention period                        itself. Additionally, the employer may        with specialized providers due to
The period during which employment-               not be able to demonstrate compliance         large volumes.
related documents must be retained by a           with the obligation during either an
company varies in Brazil.                         administrative inspection or a judicial
                                                  claim.                                        Considering the current scenario, in
Documents related to labor obligations,
                                                                                                order to assure appropriate control and
such as a work-shift register, payment and        Digital age
                                                                                                compliance with document-retention rules,
benefits receipts, should be retained for
                                                  Currently in Brazil there are some            it is important to establish processes to
five years. This is because the statute of
                                                  electronic ancillary obligations related      centralize and digitalize the information
limitations for queries is five years. The
                                                  to labor and social security compliance.      related to work contracts.
employee has a deadline of two years
                                                  In this sense, employers should retain
after the work contract is terminated
                                                  delivery receipts. This is not only in case
to start a claim relating to labor rights.
                                                  there is a query related to the delivery
The five-year period also applies to
                                                  of some information; it will also enable
union documents: collective bargaining
                                                  the company to rectify information if
                                                  necessary and deliver adjusted files to the

                                                                                                Tatiana Carmona
                                                                                                Luann Macedo

10 Employment Documentation Management Globally
Rebeka Kleytman                                                                                              Bulgaria

Stricter regulation and new                  and cost-free access to their documents         communicate electronically, the employer
                                             in both hard copy and electronic form,          is not allowed to refuse the delivery of
information-handling rules
                                             as applicable. If the employer opts for         hard-copy documents to the employee.
A struggle between employment                electronic handling of information, a           No special regulations apply for
law and innovation                           number of formal steps must be covered          the storage of collective bargaining
                                             to ensure the legality of the procedure.        agreements and works council documents.
Upon conclusion of an employment
                                             Moreover, all costs for handling and
agreement, an employer must keep files                                                       As a general trend, local employers
                                             access to the system are the responsibility
with all documents related to the position                                                   are still struggling to put in place
                                             of the employer, including training
and its termination. Today documents                                                         appropriate procedures to handle
                                             employees on how to access and use
are still kept primarily as hard copies.                                                     information in full compliance with the
                                             the system.
However, recent employment-law changes                                                       new General Data Protection Regulation
                                             No special provisions apply to storage          (GDPR) requirements, considering the
introduced in 2018 regulated in detail
                                             location. However, the obligation of the        limited case law and market practice.
the option for an employer to keep
                                             employer to grant employees access to           Another challenge for them is to find the
documents in electronic form. The new
                                             documents related to them should be             balance between technical standards
regulation introduced measures that are
                                             considered when choosing the appropriate        that they need to meet to ensure safe
partially stricter than the existing legal
                                             document-handling policy.                       communication and the GDPR. Moreover,
framework for electronic communication,
such as stronger technical and               Regarding duration, different storage           certain safeguards previously used on a
authentication requirements and access       terms apply to different categories             regular basis for employment relationships
rules. Irrespective of how documents are     of documents. For example, payroll              — such as data processing based on an
stored, employers must take appropriate      documents, materials not returned to            explicit consent granted by the data
measures to protect any employee-            employees, registers of labor books issued      subject — have been regulated differently,
related information. In general, hard-       by the employer and copies of certain           and the possibility to rely on consent
copy documents must be stored on safe        certificates issued must be stored for a        regarding the personal data of employees
premises with limited access, while files    period of 50 years. Medical certificates,       has been limited considerably. The risk of
stored in electronic form must comply        bank account information and claims for         personal-data violations and the related
with a number of requirements, such          compensation payment are stored for             principles, such as storage limitation, data
as electronic signature, specific system     five years.                                     minimization and purpose limitation, must
maintenance and restricted access. Any       If the employer is liquidated before the        be constantly monitored. Existing policies
electronic system must also provide          respective storage periods have expired,        must be regularly updated to reflect new
opportunities for generating reports         the employee files must be handed over          markets, authorities and court practices,
and historical references for all actions    to the National Social Security Institute       as well all legislative changes.
related to the inclusion of documents in     (NSSI) for storage. Even if the employer
the employment file. Employers must          and the employee have agreed to
provide employees with uninterrupted

                                                                                             Rebeka Kleytman

                                                                                           Employment Documentation Management Globally 11
Canada                                                                                                        David Witkowski

Employment documentation                          statutorily mandated stored documents          where a claim by an employee regarding
                                                  and their respective minimum storage           a record could arise after the minimum
                                                  times are set out below. (These may differ     storage period expires. Given the
In today’s global environment, employers          by jurisdiction and if the company has         relatively low cost of electronic storage,
and even individual employees often               a specific policy that involves a higher       we typically recommend retaining
traverse multiple countries. As a result,         obligation.):                                  documents for longer than the minimum
we often receive questions on employers’          • Name, social insurance number                periods (e.g., 10 years).
obligations to store their employees’ data          (SIN), address and employment-               Privacy
in Canada.                                          commencement date must be kept for
                                                                                                 Collection, storage, disclosure and
Multiple jurisdictions                              three years after the employee’s end of
                                                    employment.                                  destruction of employee documentation
Most employment-related matters in                                                               may be governed by applicable privacy
                                                  • Records relating to daily, weekly and
Canada are individually governed by                                                              legislation, depending on the jurisdiction.
                                                    overtime hours worked, pay period, wage
each of Canada’s 14 jurisdictions — 10                                                           This means, among other things, that
                                                    rate, overtime pay, gross and net wages,
provinces, three territories and the federal                                                     employees should be allowed access
                                                    termination pay, deductions, amounts for
jurisdiction, if the employer is operating                                                       upon request to update information, and
                                                    room or board, vacation pay and time,
in an industry considered to be a federal                                                        appropriate safeguards should be in place
                                                    statutorily protected leaves of absences,
undertaking, such as banking, marine                                                             to ensure only those requiring access
                                                    and health and safety training must be
shipping, air transport, railways, and                                                           have it.
                                                    kept for three years after the information
radio and TV broadcasting. The relevant
                                                    was given to the employee or after the       Location
jurisdiction is largely determined by the
                                                    period to which the record relates.
location of the employee’s work, unless                                                          While the requirements vary by
the employer is federally regulated.              • Books and records relating to payroll        jurisdiction, the highest standard requires
                                                    — including tax, Canadian Employment         that employee records be kept at the
The following guidance will focus mostly
                                                    Insurance and Canada Pension Plan            principal place of business within the
on Ontario, Canada’s most populous
                                                    deductions, as well as evidence of           jurisdiction (in the case of cloud storage,
province. Accordingly, the specifics
                                                    collecting an employee’s SIN and his         the location of the servers). However,
may vary if an employee works in other
                                                    or her form TD1 — must be stored for         those jurisdictions tend to focus largely
                                                    a minimum of six years after the filing      on ensuring that the records are readily
Document types and storage                          to which they relate. There are some         accessible locally (e.g., electronically). It
periods                                             exceptions to certain types of tax-related   is likely sufficient for documents stored
While there are many different documents            documents that may require indefinite        centrally to be accessible from servers
that an employer may be required to                 storage.                                     within the jurisdiction at hand.
store over the course of an employee’s            Despite these minimum storage
employment, the main categories of                requirements, there may be instances

                                                                                                 David Witkowski

12 Employment Documentation Management Globally
Carlos Sandoval                                                                                                Colombia

Employment documentation                     3. Evaluations of the work environment           It is important to keep in mind that the
                                                as a result of programs to control            statute of limitations for labor actions
management in Colombia                          hazards and risks in occupational             is three years; it is five years for social
In Colombia, certain labor documents            safety and health                             security. For pension matters, however,
must be retained for a specific period,      4. Records of training activities related to     there is no statute of limitations, so it
according to regulatory provisions.             occupational safety and health                is advisable to keep the labor history
                                                                                              of employees for at least 100 years in
Employment documents that must               5. Registration of the supply of personal
                                                                                              physical or electronic form.
be retained                                     protection items and equipment
Decree 1072 of 2015, in its article
                                                                                              Data protection
                                             For other documents and records, establishes that the employer    associated with the SG-SST, the employer         Each employee must authorize the
must keep records and documents              must create a system of document                 processing and preservation of their
that support the Occupational Health         retention in accordance with current             personal data according to the parameters
and Safety Management System (SG-            regulations and internal policies.               established by Law 1581 of 2012, which
SST), ensuring they are legible, easily                                                       regulates general provisions for the
identifiable, accessible and protected
                                             Other employment documents
                                                                                              protection of personal data.
against damage, deterioration or loss.       Although there is only express regulation
Conservation can be done electronically      on the obligation to preserve documents
as long as the preservation of information   associated with the SG-SST, for some
is guaranteed.                               specialists, in accordance with commercial
The following documents and records          regulations, other employment documents
must be kept for a minimum period of         should be kept for at least 10 years,
20 years, counted from the moment the        during which there is an obligation to
employment relationship ceases:              keep books and commercial documents
                                             on paper or in any technical, magnetic or
1. The employee’s epidemiological profile    electronic means that guarantees their
2. Periodic health examination               exact reproduction. (See Article 28 of
   assessments                               Law 962 of 2005 and Article 60 of the
                                             Commercial Code.)

                                                                                              Carlos Mario Sandoval
                                                                                              Adriana Alejandra Fernández Montejo

                                                                                            Employment Documentation Management Globally 13
Costa Rica                                                                                        Laura Navarrete Hernández

Costa Rica does not have extensive                  In this regard, Article 23 of the Labor       Finally, it is crucial to document the
legislation regarding an employer’s                 Code refers to the obligation of all          cause of termination (e.g., dismissal with
obligation to keep personnel files or               employers to sign written employment          or without cause, resignation, mutual
the way in which such files should be               contracts. Each party should have a           agreement or retirement). Based on the
kept. However, a good practice is to                signed copy of such agreements, given         cause, the employer will calculate how
document all aspects of the employment              that this contract should serve as evidence   much is owed to the employee for his or
relationship. Costa Rican law states                of the agreed employment conditions.          her labor liquidation. There should be no
that if an employee files a claim before            If an employer does not have a copy of the    room for interpretation on the cause for
the labor courts, the employer has the              contract, the Labor Ministry is entitled to   termination. In cases of dismissal with
burden of proof and should be able to               file a claim before the court for breaches    cause, if the worker does not wish to sign
produce the necessary documentation to              to labor and employment law. This judicial    the dismissal letter, a copy of the letter
defend its actions within the scope of the          process will look to impose fines on          should be sent to the Labor Ministry within
employment relationship.                            employers who are not compliant with this     the next 10 calendar days. For a dismissal
To support this burden of proof, it is              obligation.                                   without cause, the document should be
recommended that all stages of the                                                                signed by two witnesses who may attest
                                                    Also, the Labor Code defines that payment
employment relationship be properly                                                               that the fired employee did not agree to
                                                    slips should be handed over to employees
documented — from the recruitment and                                                             sign the document.
                                                    with the specific breakdown of all the
selection process until the employee’s              components that sum up the employees’         Concerning the proper place for storage,
termination.                                        total salary. Therefore, such payment slips   the common practice is to keep personnel
These documents should be kept                      should indicate the period that is being      documents in a company’s main offices
for the duration of the employment                  covered, payment amount for each hour         in a physical personal file that is properly
contract and at least a year after the              of overtime, the employee’s base salary,      secured. Although having a digital copy
employment termination took place.                  whether commissions or bonuses were           of the file is practical — it can serve
Yet, for social security purposes, the              paid, how many vacation days were paid        as assurance against the potential
statute of limitations is 10 years, and in          and used, and other important data.           destruction of the physical file — the
practice there have been inconsistencies                                                          original version of certain documents,
                                                    In addition to the above, internal rulings
with the information kept by authorities                                                          such as the employment contract, will
                                                    or policies should also be communicated
when employees are looking to file                                                                always be the best proof.
                                                    to personnel. The best way to ensure that
their request for retirement. Therefore,            employees understand and agree upon
the recommendation would be for all                 the terms of such internal policies is for
employers to save a scanned copy of                 each employee to sign an acceptance
all the documents included in each                  document and have them stored in their
employee’s personal file.                           personal file.
What documents should an employer
consider including? Under our view,
the most essential document to include
in personnel files is the employment

                                                                                                  Laura Navarrete Hernández

14   Employment Documentation Management Globally
Ondřej Havránek                                                                                          Czech Republic

Employment documentation                       signature that is in compliance with the EU     • 30 years following the year to which such
                                               regulation concerning electronic services         document pertains to a remuneration
Employers must process personal and            (eIDAS); and (iii) the employee must              statement
payroll information. They are entitled         confirm acceptance by the employee’s            • 5 years after termination of the work
to keep the personal files of employees,       recognized electronic signature within            council’s term for its documents
which may include only documents that          three days. Otherwise, the electronic
are necessary for work performance                                                             • 5 years after termination for collective
                                               documents will not carry any legal effects.
(e.g., employment contracts, documents                                                           agreements
                                               To have fully electronic personal files
concerning education, professional                                                             • 3 years after termination of employment
                                               requires either (i) the ability to deliver
training and fitness to work, as well                                                            for a copy of a foreigner’s residency
                                               the important documents under the
as special permits if required). Only
                                               above conditions or (ii) to have the paper      Employee’s access to his or her
supervisors and some public authorities
                                               documents converted into electronic             personal file
are allowed to inspect these personal
                                               documents by the contact centers of the         Every employee has the right to inspect
files. The keeping of personal files is also
                                               public administration (Czech POINT),            his or her personal file, to make extracts
subject to the EU General Data Protection
                                               or by attorneys (converted electronic           from it and to make copies of the
Regulation (GDPR).
                                               documents have the same legal effects as        documents contained therein, all at
Form and location of keeping                   the paper originals).                           the employer’s expense. Further rights
personal files                                 Regarding the place where files are kept,       on the side of the employee follow
The Czech Labor Code (CLC) does not            such location may be outside of the Czech       from the GDPR.
prescribe the form or the location where       Republic or in cloud storage; in either
                                                                                               Best practice
personal files can be kept.                    case, storage of the files must be carried
                                               out in compliance with the GDPR.                The majority of employers keep a
Regarding the form, documents
                                                                                               combination of physical and electronic
concerning the start, change and               Retention period
                                                                                               personal files. Generally, copies are
termination of an employment and salary
                                               The CLC does not expressly prescribe            sufficient for an employer’s usual agenda.
statement (the “important documents”)
                                               the retention period for keeping personal       It is possible to store the physical files
are required to be in written form. While
                                               files; therefore, it is recommended that        outside of the employer’s offices, provided
there is a possibility to maintain the
                                               the employee’s file be kept for the term of     such storage is compliant with the GDPR.
written form of legal acts by electronic
                                               employment and three months following           It is also recommended that originals
means, permitting one to (i) keep its
                                               termination unless a potential risk of          of the documents are accessible within,
contents and (ii) determine the person
                                               a legal dispute arises. In such a case,         for example, five days in cases where
who acted, the CLC also requires that the
                                               the employer may keep the documents             the public authorities should require
important documents be delivered into
                                               related to a prospective legal dispute for      them regarding legal disputes, audits or
the concerned employee’s own hands in
                                               a statutory or contractually time-barred        inspections.
compliance with the CLC.
Delivery of electronic documents
                                               The below retention periods for specific
is possible under the following CLC
                                               documents are set out in the legal
conditions: (i) the employee grants
consent and provides an electronic mailing
address; (ii) all the employer’s documents     • 10 years after the date of termination
delivered in electronic form are signed          of their validity for the internal rules
                                                 stipulating employees’ entitlements           Ondřej Havránek
by a so-called recognized electronic
                                                                                               Eva Procházková

                                                                                             Employment Documentation Management Globally 15
Estonia                                                                                                      Signe Viimsalu

e-Estonia and employee files                      employee in the employment register,           3. Provide the internal rules of the
                                                  reporting taxes and more; everything can          organization and obtain an employee’s
Digital governance                                be executed electronically and by using           confirmation and acknowledgement
                                                  digital ID. Thus, employee files are mostly       of the rules.
Estonia started to develop its information
                                                  created electronically.                        4. Notify the employee about who is
society and digital identity over 20 years
ago to improve the competitiveness of             An employee’s file may be electronic              using the employee’s data and on
Estonia and the well-being of its people.                                                           what terms. The employee file must
                                                  and maintained in a cloud as long as it is
                                                                                                    include the employee’s consent
The aim was to implement a hassle-                secured and the information is accessible
                                                                                                    and acknowledgement of the data-
free governance. Starting from the                and reproducible if needed. In accordance
                                                                                                    protection rules of the company.
development and launch of e-Governance            with data-protection rules, the employee
in 1997, e-Tax in 2000 and digital                has the right to demand information that is    5. File information that is the basis for
identification (ID) in 2002, Estonia likely       collected about him or her and request to         accounting entries, such as salary
has become the only country in the world          amend information if it is incorrect.             payments.
where 99% of public services are available                                                       Work council and collective bargaining
and accessible online 24/7, and people can        Retainable documents
                                                                                                 agreements are not widely used in
access their data, e.g., tax information or       The statutory requirement mandates that        Estonia, but if at any stage the council
employment history, online wherever they          the employment contract be in a written        is established or a collective bargaining
are located.                                      format and preserved during the term of        agreement is entered into, the documents
Furthering its digital society developments,      the employment contract and for 10 years       and resolutions should be filed by the
Estonia launched its e-Residency program          after its expiry.                              employer. The documents may be
in 2014, which is a transnational digital                                                        electronic as long as they are accessible
                                                  The employer is obligated to organize and
identity that provides e-residents                                                               and reproducible if needed.
                                                  obtain the following consents and check-
government-issued digital IDs and full            ups regarding the employment relationship
access to Estonia’s public services. This         in addition to the written employment
also enables a way to establish trusted           contract:
European Union businesses with all the
tools needed to conduct business globally.        1. Provide risk analysis for the position
The easy access and information-society              and notify the employee about the risks
services are attractive for both employers           related to his or her tasks and position.
and employees. So let’s have a look at               File the information when the employee
what impact these digital services have on           has been notified and obtain the
the employment relationship and filing.              confirmation from the employee.

                                                  2. Organize the employee’s health check
General rules and practices
                                                     within four months of employment
Using digital solutions in employment                and conduct follow-up health checks in
matters is very common in Estonia,                   accordance with the laws. An employee
including the confirmation of the                    file must include the information
employment contract, registering the                 and confirmations received from the
                                                     occupational health care doctor.

                                                                                                 Signe Viimsalu
                                                                                                 Maris Merilo

16 Employment Documentation Management Globally
Maiju Kurvi                                                                                                           Finland

A fragmented data-retention                   period — i.e., for two years after the end of     For foreign employees, employers must
                                              the calendar year, during which the right         keep records on current and past foreign
regulation                                                                                      employees and the grounds of their right
                                              for compensation has originated, or for
In Finland, employers are only allowed        two years from the end of the employment          to work easily available at the workplace.
to collect, process and keep recorded         relationship. On request, an employee is          This information must be stored for
information concerning their employees        entitled to a written clarification of the        four years beyond the termination
that is necessary for the employment          entries in work-shift lists and working-          of employment (see the Aliens Act,
relationship. Such information must relate    hours records concerning him or her.              301/2004).
to each party’s rights and obligations, the   Similar retention rules and an employee’s         In addition to the examples presented
benefits offered by the employer and the      right for clarification apply to the records      above, it is important to remember the
special nature of certain work duties. As a   of annual holidays in accordance with the         retention times for payroll accounts and
main rule, employee information must be       Annual Holidays Act.                              accounting material, which generally
collected from employees themselves, and      According to the Employment Contracts             should be kept for 10 years after the end
the employees generally need to give their    Act (55/2001), the employee’s right               of the financial year.
explicit consent to employers to allow        to claim wages due (and any other                 As a final note, while employers should
them to collect personal data elsewhere       compensation due to the employment                be aware of the regulation that sets out
(see the Act on the Protection of Privacy     relationship) will lapse after five years         mandatory retention times, it is equally
in Working Life, 759/2004).                   while he or she is employed and in two            important to set up functioning and
In addition to the EU General Data            years after the end of the employment             dynamic processes for data storage and to
Protection Regulation (GDPR), the Finnish     relationship. Thus, the related                   keep records up-to-date.
regulation on retaining employment data       documentation is to be kept for at least
is widely spread across the legislation.      this length of time for both circumstances.
Special provisions set out mandatory          However, a 10 years’ retention time has
retention periods for employment data,        been set for letters of references as
whereas the data-protection regulation        well as for documentation that relates
sets out restrictions for keeping such        to compensation on damages due to
data. In general, all employment data         personal injury.
can be stored in electronic form — i.e.,      Keeping employees’ health information
no paper files are required as long as the    has been peculiarly restricted by laws.
records are easily accessible and readable.   Concerning information on employees’
However, it is not possible to store all      health, the data may only be processed
employment data for an unlimited time         by persons who prepare, make or
or for the same amount of time across         implement decisions concerning
the board.                                    employment relationships based on such
According to the Working Hours Act            information. In addition, employers must
(605/1996), the employer must keep            store any information in their possession
records of working hours (e.g., work-         concerning employees’ health separately
shift lists and records of working-hours      from any other personal data that has
systems) at least during the related claim    been collected.

                                                                                                Maiju Kurvi
                                                                                                Annina Hyrskyluoto

                                                                                              Employment Documentation Management Globally 17
France                                                                                                            Roselyn Sands

Employment documentation                          generally based on the applicable statute-    For other countries, it must be ensured
                                                  of-limitations period, for example:           that minimum guarantees are provided.
                                                  • One year to challenge a dismissal           In this context, employers need to be
Most multinational organizations must                                                           careful when they use a cloud or a
                                                  • Two years for claims related to the
manage more and more data related to                                                            Software-as-a-Service mode, as servers
                                                    execution of the employment contract
their employees.                                                                                can be located in various countries,
                                                  • Three years for salary claims or social
As a result, employers need to implement                                                        including places where guarantees are
                                                    security contributions payment
solid management employment                                                                     not compliant with EU law.
documentation systems.                            • Five years for discrimination claims.
                                                                                                Can the employee have access?
French law and authorities provide a              Specific higher retention periods also may
complete set of recommendations.                  exist (e.g., the French Labor Code provides   Employees have the right to access their
                                                  that pay slips in electronic format must be   personal data if they desire, to rectify the
Which documentation should be                     kept for 50 years!).                          data if needed, or to erase it. Employers
retained by the employer                                                                        need to inform their employees about
                                                  Paper or digital?
French employers should notably retain                                                          these rights.
for each employee:                                French law does not impose paper or
                                                  digital format. The digitalization is
• The
       employment contract and its
                                                  however more and more encouraged              Effective global management of
    successive amendments if any
                                                  by the French Government and the              documentation is paramount.
• All documents related to employees’             administration (e.g., regarding proof         The GDPR promotes the empowerment of
  working conditions, in particular working       of professional expenses). The digital        individuals regarding their personal data
  time performed                                  format is highly regulated technically to     and imposes liabilities on employers.
• Payslips                                        guarantee the integrity of the document.
                                                                                                Sanctions provided by the GDPR are
• Disciplinary file if any                        Where?                                        very high (e.g., a fine of 4% of the
Documents related to collective status and                                                      global turnover or EUR 20 million) —
                                                  There is no obligation to keep
relations with employee representatives                                                         this empowerment may also give rise
                                                  documentation in the country of origin of
should also be kept by the employer.                                                            to new forms of litigation around the
                                                  the data.
                                                                                                management of HR documentation,
For how long?                                     However, data transfer is geographically      including employees’ personal data.
The French Labor Code only provides for a         limited by national and European
                                                                                                On a final note, documents should not
few mandatory retention periods (e.g., the        regulations, notably the General Data
                                                                                                be retained longer than necessary,
CV of a candidate who is not hired cannot         Protection Regulation (GDPR). Data
                                                                                                specifically because employee access
be kept for more than two years).                 transfer is authorized within the European
                                                                                                rights can provide fertile ground for
                                                  Union and with countries considered as
However, employers need to retain                                                               employee to have “de facto” discovery in
                                                  providing the same level of guarantee as
employment documentation to defend                                                              employment litigation.
                                                  in the EU countries.
themselves in case of litigation Therefore,
recommended retention periods are

                                                                                                Roselyn Sands
                                                                                                Aurelie Bernard

18 Employment Documentation Management Globally
George Svanadze                                                                                                     Georgia

Employment documentation                      Pursuant to applicable laws of Georgia,         This supports easier control from the
                                              the employer must keep the data, consider       perspective of state authorities as well
management in Georgia
                                              the character of the work involved and          as overall better management at the
The global tendency of individual privacy     observe principles of adequacy.                 employer’s level.
has urged employers to resort to higher       There are no specific regulations in            The time period for holding documents
standards of documentation management.        Georgia as to what form the employment          is directly regulated, with specific
Employment documentation management           documentation should be held. Therefore,        requirements for every possible document
in Georgia must safeguard the balance         both public and private companies are           that may be created in the work process.
between the legitimate interests of the       free to tailor their own methods of             Depending on the type of document,
employer and the rights of the employee.      documentation management.                       periods will vary from one year up to
Such balance is achieved via general          The current legislation does not                several decades. Personal data must
regulations related to documents created      explicitly state whether employment-            be kept for as long as required by the
in the ordinary course of business, laws on   related documentation must be kept in           duration and nature of the employment
personal data protection and regulations      Georgia or abroad. Employers are free           relationship.
existing in the public sector.                to keep documents in cloud systems              As a rule, employees must have full access
In general, the laws of Georgia lack          and transfer the personal data to other         to their employment documentation,
specifics in terms of required documents      countries without further administrative        subject to certain limitations provided by
that the employer must retain. There is no    procedures, considering that they provide       the law.
explicit list for private-sector companies.   sufficient safety guarantees.                   Overall, the general framework on
In contrast, a more precise approach is       The Law of Georgia on Personal Data             employment documentation management
elaborated in the public sector. The Law      Protection, however, requires employers         is rather pliant and unmethodical, with
of Georgia on Public Service lists that the   to adopt certain organizational and             room for some discretion by the employer.
job application form, together with the       technical security measures to secure           The issue of personal data protection,
candidate’s CV, certificates of education,    employee information. More specifically,        however, offers more certainty.
identification documents, and medical         they must ensure only designated                This is particularly true for security
and narcotic inspection notes, among          personnel have access to this type of data,     requirements, retention periods and
others, must be kept by the public-sector     with guaranteed confidentiality.                employee access to employment
                                              Employers are also free to retain physical      documents, and the personal data given
Any document related to the employee          copies of documents. However, if the            therein. Changes in regulations are
and managed by the employer to some           employer opts for the electronic system,        further anticipated, potentially introducing
extent consists of personal data. Normally,   access must be secured with password            more clarity.
as proven above, such documents range         authorization. Access is granted only to a
from identity documents and biographies       limited number of persons. To ensure the
to certificates of education and financial    efficiency of documentation management,
information, depending on the type of         employers are obliged to create a filing
employment.                                   system with a subsequent catalogue.

                                                                                              Dr. George Svanadze
                                                                                              Levan Kipiani

                                                                                            Employment Documentation Management Globally 19
Germany                                                                                                     Dr. Karsten Umnuss

Employment documentation                          protection reasons.                            The documents need to be freely available,
                                                                                                 either in physical or electronic form.
management globally                               There are different legal retention
                                                  periods for documents — e.g., application      If the employer wants to hold the
Personnel files                                   documents must be retained for three           documents in physical form, the location
There are few legal obligations for               years after the end of the employment          must be generally and freely accessible,
employers to retain documents relating to         relationship; pay slips should be kept for     such as in break rooms, in canteens,
the employment of employees. However,             10 years after. Documents ideally should       on a notice board, or in the reception
it is recommended to retain additional            be held as long as claims can be asserted,     or the office of the works council. Work
documents in an employee’s personnel              according to the limitation period. The        agreements and collective-bargaining
file, especially the employment contract. If      statutory limitation period generally          agreements can also be held in the
there is no written employment contract,          amounts to three years after the end of        personnel office if an employee is given
the essential contractual conditions of           the employment relationship. Employment        access upon request. It is important that all
an employment relationship must be set            contracts, works council agreements or         employees have access to the documents.
out in writing. This is necessary because         collective bargaining agreements, however,     Also, all effective documents need to be
of legal requirements for the notification        can determine a shorter cut-off period of at   kept up-to-date.
of conditions governing an employment             least three months.
relationship and as an evidence in cases          Every employee has the right to access his
of legal disputes. Application documents          or her complete personnel file by law at any   Depending on the situation in the company,
with the employee’s certificates and              time, without naming a reason. A member        the physical form of the stored documents
qualifications, pay slips and possible            of the works council can accompany the         can be preferred — e.g., in cases where
warning letters are also usually kept in the      employee.                                      employees do not work with computers
personnel file.                                                                                  and would not be able to easily access
                                                  Labor guidance in Germany                      the documents in an electronic form.
Generally, employers can freely choose
                                                                                                 In general, the electronic form will be
the form in which the information may be          Employers are obliged to display laws
                                                                                                 preferred by the employer, as it is easier
held (physical or electronic). If an employer     that are important for the employment
                                                                                                 in practice. In this case, it is important to
chooses the electronic form for the               relationship, such as the Working Time
                                                                                                 consider co-determination rights of the
personnel file, the co-determination right        Act, the General Equal Treatment Act, the
                                                                                                 works council as well as data-protection
of the works council (if existing) in issues      Works Constitution Act and the Act on Part-
                                                                                                 issues if, for example, only a specific group
regarding the use of technical equipment          Time Work and Fixed-Term Employment,
                                                                                                 of people has access to personal data.
to monitor the behavior or performance of         as well as all relevant health and safety
employees must be considered.                     regulations. Furthermore, works council
                                                  agreements and collective bargaining
The employer is free to choose where
                                                  agreements must be displayed by the
to keep the personnel file. Employers
may retain the physical documents in a
secure personnel office so not everyone
has access to the documents for data-

                                                                                                 Dr. Karsten Umnuß
                                                                                                 Dr. Yavuz Topoglu

20 Employment Documentation Management Globally
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