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Easy Document Retention Guidelines for California Businesses

filesThe Internet is full of sample schedules, policies, and guidelines for document retention. The problem is knowing which are accurate, out-of-date, and most importantly, which comply with California guidelines. Furthermore, because there are so many state and federal laws governing how long documents should be kept,  depending on the exact nature of the document, it can be difficult keeping everything straight. Many businesses, however, do not have a dedicated records division, and do not mind erring on the side of keeping records long than actually necessary, in exchange for a clear and straightforward set of suggested guidelines.

The below guidelines are thus simplified to provide business owners general guidance on how long documents should be kept  using the longest minimum required timeframe required for documents within a specific category (i.e., taxes and tax-related documents).   For example, federal laws require tax information to be kept for at least 7 years, while California law requires sales use tax information to be kept for at least 4 years. Rather than expending resources maintainign records that distinguish between sales use tax documents and federal tax documents, simply keeping “all” tax documents for 7 years covers the business while providing simpler ease of administration, even if sales tax documents are being kept slightly longer than they actually need to be.

Obviously, there is no one-size-fits-all schedule, but here is a chart that will provide a simple plain-english overview. As with all forms and checklists, the below shouldn’t be used as a substitute for getting legal advice unique to your company’s facts and circumstances or construed as legal advice:

Employee , Employment, HR Documents, Benefits
(Job Applications, Resumes, Help Wanted Ads, Announcements of Opportunities, employee HR Files, work schedules, time-cards, payroll records, wage records, I-9 forms, child labor documents, election of benefits forms, COBRA notices, summary plan descriptions, earnings information,  affirmative action programs, FMLA, CFRA, ADA documents, immigration records, etc.)

  • Keep for duration of employe’s employment + 6 years, or 6 years if not related to a specific employee

Health Records
(Medical records, Worker’s Compensation evaluations, drug/alchol test results, OSHA injuries, illnesses, deaths, etc.)

  • Any and all medical records should be stored and maintained separately from Employee’s HR File
  • Employees exposed to chemicals or pesticide: Duration of employee’s employment + 30 years
  • All others: Keep for duration of employee’s employment + 5 years

Tax and Tax-Related Documents

  • Indefinitely

Company/Business Corporate Records
(corporate registrations, minutes, corporate governance documents, financial transactions, permits, business licenses, etc.)

  • Indefinitely

AXIS Legal Counsel’s Business and Corporations Practice provides legal advice to numerous businesses with a variety of legal matters, including business formations, contracts, deals, and transactions, business administration, corporate governance, operations, risk management / insurance,  labor/employment matters, intellectual property, healthcare, crisis management, directors/officers, private/data security, technology, statutory/legal compliance, and business litigation. AXIS represents businesses, corporations, LLCs, LLPS, partnerships, and startups in need of a corporate lawyer, for business legal matters as well as business litigation, such as disagreements, non-solicit agreements, non-competes, trade secrets, and others. We are also experienced in providing assistance to business clients concerning business contracts, corporate formation matters, contracts and transactions, business litigation, business legal advice for Corporations, LLPs, LLCs, Partnerships, Small Business, Startups, and others involving corporate law.

If you are seeking a business lawyer, or for information on retaining AXIS Legal Counsel to represent your business in connection with any legal matter, contact [email protected] or call (213) 403-0130 for a confidential consultation. Axis’ managing attorney Rabeh M. A. Soofi is ranked as one of the “Top Women Lawyers of Southern California” by SuperLawyers Rising Stars, and is a Los Angeles Business Lawyer representing businesses and start-ups throughout Los Angeles and California.

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