How good is your employee records system?

Not long ago one of our retail consulting clients received a notification that they were going to be audited by the Immigration and Naturalization Service or INS.

They told the retailer’s human resources team that they would be coming by their offices in one week in order to conduct a detailed examination of the company’s records.  Quickly the retailer’s team needed to gather the following items in order to have them reviewed by the INS representative:

·        I-9 forms for all current and terminated employees for the last 3 years

·        A list of all current and terminated employees with hire and termination dates

·        Copies of quarterly wage and hour reports for all employees current and terminated for the last 3 years

·        Quarterly tax statements (941) for the last 3 years

·        Business info including EIN #, TIN #, owners SS#, owner address info, phone #'s, e-mail addresses, copies of articles of incorporation, copies of businesses licenses and any other pertinent info

·        Copies of any and all correspondence from SS Admin to employer regarding mismatched SSNs

Luckily, our client had done an excellent job of maintaining their employee records and they came out of the audit with a great report.  This is because they were aware of the consequences of failing this type of inspection – the fines for missing I-9s can be up to $10,000 per incident – and put a strong system in place for collecting and maintain all of this paperwork.

How Strong Are Your Retail Operations Practices?

The real question is could you successfully pass an audit of your retail employee paperwork?  Below is a list of the documents, forms, reports and other information every retailer should have their employee files.

·        Job description for position

·        Signed application and resume

·        References and interview notes

·        Offer letter and hire date

·        Employee information sheet

·        I-9 and copies of identification documents

·        Schedule request form

·        W-4

·        Payroll records

·        Signed company policy documents

·        Performance evaluations

·        Disciplinary action forms and notes

·        Complaints and compliments

·        Termination information

·        Signed receipts and acknowledgements of handbooks and manuals, keys and codes, etc

·        Records of training and testing completion

Any one of a number of governmental agencies could pay your business a “surprise” visit. This includes the INS, IRS, OSHA, the Department of Labor and various state agencies.  Step one for being ready for those inevitable visits is to have your employee files in order. How would your retail business fare?

A great first step is to ensure that all of your retail managers a properly trained in interviewing, hiring and completing all of the processes associated with the onboarding process.  A great way to start is to invest in retail management courses such as our “Recruiting, interviewing and hiring” elearning bundle.  For more information about this or other retail management courses, contact us for a free one-hour consultation.

Want to learn more about how you can improve the retail management skills for you and your team?  Contact us for a free one-hour consultation!

–        David Goodwin is the Principal of the Retail Advocacy Group.  As a 30 year veteran of the retail industry he has hired, trained, and performance managed thousands of retail sales representatives and retail managers.  You can learn more about instructor-led, e-learning, and other training solutions for retailers at