Risk Management for Employers: 7 Ways You Must Document Your Workforce

by | Jul 20, 2017 | Business, Employee Documentation, Employee Handbook, Risk Management

This week our blog is written by Bill Hoch, CEO and Chief Counsel at EmCo Consulting, LLC, Boston Ma.  Bill has facilitated several of the FBinsure CEO Seminars and is one of our key resources and information experts.  We are pleased to add his expertise to our blog and encourage you to reach out to Bill or our FBinsure team should you have additional questions.

Managing employees may be your least favorite part of running a business.  Managing employees well takes time that could always be spent on other things.  But, taking the time to create important documents will help reduce your risk of paying damages or hefty settlements to disgruntled employees.  For example, documenting events when they happen will help you remember the facts.  Legal claims don’t always happen right away.  Oftentimes they can often be brought one to three years after an incident occurs.  Keeping detailed documentation will help you remember what really happened and give you a better defense to an employment claim.

There are 7 common areas where good documentation will help you manage your workforce and reduce your risk of financial harm.

  1. Job Descriptions. All job descriptions are important to outline.  Detailing key duties, required experience or education, a job’s physical requirements, tools or skills necessary to do the job as well as clear expectations are critical.  In a disability claim where the argument is that a specific task “is not my job,” or a claim over a poor performance review, it’s crucial to have clarity around what the job duties and requirements are especially if you want to say a person is no longer qualified or meeting expectations. (Remember, always include “other duties as required or assigned” in the job duties).
  2. I-9 forms. Make sure you have an I-9 form for all  These should be completed on the first day of employment to prove a person has the legal right to work in the USA.  All sections of the I-9 form must be completed and signed by the person who reviews the employee’s documentation.  An annual 15 minute review of your I-9 forms for the past year for thoroughness or an audit may be needed.
  3. Having an employee handbook with clearly outlined policies provide an employer with flexibility to deviate from the policy in appropriate circumstances.  If something is important to you (for example, dress code, calling in when an employee will be sick, safety, prohibited behaviors, etc.), you should make that clear through a good policy.  Some policies are required law (for example, anti-harassment policies, sick and vacation policies, family and medical leave policies).  It’s better to have clear policies than to argue about the policy in court before a judge.
  4. Incident Reports. Whenever someone is injured, acts inappropriately, or brings a complaint that they were harassed or mistreated, you should create an incident report to document what happened.  Witnesses to the incident should be required to write down what they said or heard that day.  No one has the right to refuse to document something that happens at work if you ask them to write a report.
  5. Time and Attendance. You should have accurate time and attendance records so you can show the exact days and hours that someone worked.  For employees who are eligible to earn overtime, you must be able to prove the hours they worked in case they try and claim they were forced to work overtime and were not paid time and a half.  You must also clearly track vacation & sick time. These records should be signed weekly by the employee so they can’t later challenge their accuracy.
  6. Performance Reports. You should document performance reviews, conversations about poor performance, and probationary periods or last chance agreements.  When an employee isn’t meeting your expectations, it’s crucial to document the problem, what you need them to do to meet expectations, and the consequences if they fail to improve. This avoids the employee later claiming that they had no idea that their work was substandard. Have the employee sign this document to show the conversation occurred and let the employee know that a copy will be added to their personnel file.
  7. Termination. Finally, if you need to terminate someone, have documentation that clearly outlines the reason they were fired.  This will help you when they file for unemployment or if they sue for wrongful termination.  Get statements from witnesses for any incidents that provoked termination and get statements from managers for performance problems.  Creating this documentation months later will be much harder, less credible, and less accurate.

Creating and maintaining good documentation about your workforce may seem like a hassle but it will be incredible helpful if you ever get a letter from a lawyer or are challenged in court. If that happens, you will be very grateful that you took the time to document what happened.  In addition, it will avoid a time consuming effort to recreate what happened and jog people’s poor memories.  Getting sued by an employee or investigated by the state is miserable.  Having crummy documentation or no documentation makes the experience 10 times worse (and much more expensive).


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