What is an Employee File and How to Maintain One?

As an employer in the United Arab Emirates, it is crucial to understand every aspect of salary processing, WPS payroll, and how to run payroll efficiently, to ensure that your workforce remains happy and motivated. This includes maintaining accurate employee records. 

A crucial component of an efficient and compliant administrative system is the employee file. Sometimes, it is also referred to as an ‘employee personnel file’. Read on to know what’s exactly an employee file, its significance, and see how to prepare one in an effective way.

What is an Employee File?

An employee file or personnel file is a comprehensive record of all essential information about an individual’s employment history within your organization. It is like a folder with all Human Resource-related data, or specifically, a centralized repository of documents, forms, and records related to the employee’s hiring, employment, and transfer process.

Why do you need one?

It is important to have all information about one employee in one place, to refer to in case you need to find any details relevant to their role or responsibilities. In the event that an employee decides to make a claim against your company, and you need to produce any necessary records for it, having an accessible and update employee file is helpful.

Maintaining an Employee File

Creating an employee file is not a one-time task. Make sure that the files are regularly reviewed and updated in order to reflect any changes in the employee’s employment status, salary revisions, promotions, or disciplinary actions. Set periodic reminders to renew employment contracts and work permits as required.

The files can be stored in physical form (in labelled folders or binders) or electronically (secure digital storage system), as long as they are stored securely and confidentially. 

Having a standardised document checklist helps to ensure all the necessary documents are present and are up-to-date in each employee’s file.

Components of an Employee File

An employee file typically includes the following key documents:

• Personal Information: This includes the employee’s full name, contact details, identification documents (such as passport or Emirates ID), and emergency contact information.
• Employment Contract: A copy of the signed employment contract outlining the terms and conditions agreed upon by both parties.
• Offer Letter: A formal document that specifies the job position, salary, benefits, and other pertinent details offered to the employee.
• Job Description: A detailed description of the employee’s roles, responsibilities, and reporting structure.
• Performance Reviews: Periodic performance evaluations, including appraisal forms, feedback, and any relevant documentation.
• Attendance Records: Attendance sheets or records that track the employee’s attendance, leaves, and absences.
• Salary Information: Records of salary, allowances, bonuses, and any revisions or increments over time.
• Training and Development: Documentation of the employee’s training programs, workshops attended, certifications, and skill enhancement activities.
• Disciplinary Actions: Any official warnings, disciplinary actions, or related correspondence.
• Resignation or Termination Documentation: Exit interview records, resignation letters, termination letters, and related documentation.

The Compliance angle

While preparing employee files, it is vital to adhere to the UAE’s labour laws and regulations. Some key compliance-related points to consider, include:

1. Data Protection: Safeguard employee information and ensure compliance with data protection regulations such as the UAE Data Protection Law.
2. Confidentiality: Maintain the confidentiality of employee records, granting access only to authorized personnel.
3. Retention Period: Familiarise yourself with the retention periods for various employee records as mandated by UAE labour laws.

It is a legal obligation in the UAE to maintain your employee’s data safely and confidentially. For instance, did you know that the Equal Employment Opportunity Commission (EEOC) requires that employers keep all employment records for at least one year? If an employee is fired, their employment-related records must be kept for at least one year from the date of their termination.

Conclusion

An employee file is an invaluable tool for managing human resources effectively. By understanding the components, organization, and compliance considerations, you can ensure that your employee files are complete, accurate, and compliant with the UAE labour laws. 

Maintaining well-organized employee files not only helps to streamline your internal processes but also contributes to a more productive and legally sound work environment for your business. When it comes to your employees’ welfare, working with a Ministry-approved payroll card provider can help ensure that your salary processing operations, i.e. WPS payroll and WPS-compliant salary processing in the UAE remains efficient, accurate, and compliant.