Newly Signed Bill Significantly Changes Personnel Records Law

Massachusetts Governor Deval Patrick recently signed an economic development bill that contains a significant amendment to the Massachusetts personnel records law. The new law (Chapter 240 of the Acts of 2010, section 148) implements a dramatic change in employers’ legal obligations regarding personnel records. The amendment requires employers to notify employees within 10 days of the addition to their “personnel record” of any information that is being used, has been used or may be used to negatively affect the employee’s qualification for employment, promotion, transfer, additional compensation, or may subject the employee to disciplinary action.

The amendment to the statute leaves open many questions, including what it means for information to be “placed” in a personnel record. It is not clear whether an internal company e-mail or a casually written note not physically stored in an employee’s personnel file will constitute “information” under the new law. Massachusetts broadly defines a “personnel record” to include any documents that are or may be used to affect an employee’s employment, promotion, transfer, compensation, or disciplinary action. As a result, even if a document that could negatively impact an employee’s employment status is not formally “placed” in a personnel file, it is likely part of that employee’s personnel record, triggering the new notification requirement.

In addition, the law does not define the type of notice that must be given to employees when covered information is added to a personnel record. Specifically, it does not indicate whether employers must provide written notification that such a document has been placed in a personnel record or whether the notification must include a copy of the document. While it appears that any type of notification may suffice, we suggest that employers provide written and dated notification, as it will serve as a record of the employer’s compliance with the new requirement.

As was already required under the old law, employers still must permit employees to review their personnel records within five business days of a written request for review. However, the new law now limits employees to two such reviews of their personnel records in any given calendar year. Significantly, though, a review triggered by an employer’s notice that it has placed negative information in the personnel record does not count as one of the two annual reviews.

The new law does not affect the existing remedial measures provided under the personnel records law. The Attorney General retains enforcement authority and may fine an employer at least $500 but no more than $2,500 for violations. The new notification requirement also may lead to disputes during employment litigation; for example, employees may contend that negative documents about which their employers did not notify them should be excluded from the evidentiary record.

The new law may significantly affect the way employers approach personnel records and employee relations. Before a manager creates any new document that could negatively impact an employee’s position within the company, he or she should consider this new requirement. Supervisors and managers should be aware that in light of this new law, even a seemingly straightforward internal note about an employee’s performance could trigger the obligation to notify the employee. The law is effective immediately and made retroactive to August 1, 2010, so we recommend employers take the following steps:

• Adopt a company protocol for providing written, dated notice to employees within 10 days of the placement of negative information in their personnel records;
• Train supervisors, managers, and human resources professionals about company protocol and how properly to document employee performance issues; and
• Contact your Ogletree Deakins attorney to discuss ways to maintain productive and effective management of employees while complying with this new requirement.