How Long to Keep Payroll Records: FLSA, Tax, and I-9 Rules

Federal law requires you to keep most payroll records for at least three years, but how long to keep payroll records depends on the document and the law behind it. Retention windows run from two years for supporting wage data up to six years or longer for benefit plan records, and state rules can push those deadlines further. Because several federal statutes cover different pieces of the same employee file, most employers end up tracking multiple deadlines at once.

Retention Periods at a Glance

Two years: supplemental wage records like timecards, wage rate tables, and deduction records (FLSA)
Three years: core payroll records — names, hours, pay details (FLSA); payroll records under the ADEA
Three years after hire or one year after separation, whichever is later: Form I-9
Four years: employment tax records including W-4s, wage payments, and tax deposits (IRS)
Five years: OSHA injury and illness logs
Six years: employee benefit plan records and Form 5500 filings (ERISA)

The details behind each of these come from a different agency, and the specifics matter when you decide what to keep and what to purge.

Core Payroll Records Under the FLSA: Three Years

The Fair Labor Standards Act sets the three-year retention rule for the payroll records federal investigators use to confirm minimum wage and overtime compliance. The clock runs from the date of the last entry in the record.¹

Each employee’s record must contain:

Full name as used for Social Security, home address, date of birth (if under 19), sex, and occupation
The time of day and day of the week the workweek begins
Hours worked each day and total hours each workweek
Total straight-time earnings, the regular hourly rate, and total overtime premium pay for any week over 40 hours
Total wages paid each pay period, the payment date, and the pay period covered

The FLSA does not require a specific format. Spreadsheets, payroll software, and paper ledgers all qualify as long as every required data point is present and retrievable.¹

Supporting Wage Documents: Two Years

A shorter two-year rule applies to the raw documents that feed into the payroll file.² These are the records that show how each paycheck was calculated:

Timecards or time sheets showing daily start and stop times, or amounts of work completed per day or pay period
Wage rate tables and schedules of piece rates used to calculate straight-time or overtime pay
Records of additions to or deductions from wages, such as benefit deductions and garnishments

The regulation lists these categories specifically and does not require retention of broader documents like commission sheets or work schedules under this rule.² Keeping any document that affects wage calculations is still a sound practice.

Employment Tax Records: Four Years

The IRS requires employment tax records to be kept for at least four years after the tax becomes due or is paid, whichever is later.³ This covers federal income tax withholding, Social Security and Medicare (FICA), and federal unemployment (FUTA) tax.

Publication 15 identifies the specific records to retain:⁴

Copies of Form W-4 and related withholding certificates (W-4P, W-4R, W-4S, W-4V)
Amounts and dates of wage, annuity, and pension payments
Employee names, addresses, Social Security numbers, and occupations
Records of allocated tips, fringe benefits, and expense reimbursements with supporting documentation
Dates and amounts of all tax deposits

One exception runs longer. Records tied to qualified sick leave wages, qualified family leave wages for leave taken after March 31, 2021, and employee retention credit wages paid after June 30, 2021 must be kept for at least six years.³ If your business claimed any of those COVID-era credits, hold onto the supporting records past the standard four years.

Form I-9: Hire Date Plus Three, or Separation Plus One

Every employee hired after November 6, 1986 needs a completed I-9 on file. The retention formula is three years after the date of hire or one year after employment ends, whichever is later.⁵ In practice:

For employees who worked less than two years, keep the form three years after the hire date.
For employees who worked longer, keep the form one year after their last day.

I-9 forms can be stored on paper, microfilm, microfiche, or electronically. Electronic systems must include controls against unauthorized changes, an audit trail of alterations, and the ability to produce legible copies. In every format, you have to be able to present the forms to a government inspector within three business days of a request.⁶

Anti-Discrimination Records

The EEOC requires personnel and employment records to be kept for at least one year, and for an involuntarily terminated employee, one year from the termination date. The Age Discrimination in Employment Act imposes a longer requirement specifically for payroll records: three years.⁷ Meeting the FLSA three-year rule satisfies the ADEA payroll obligation.

A pending discrimination charge changes everything. Once an employee files with the EEOC, you must keep all records related to the charge, including those for other employees in similar positions, until the charge reaches final resolution and any appeals are exhausted.⁷ That effectively overrides the standard retention deadlines for the relevant files.

Employee Benefit Plan Records: Six Years

If you offer a retirement plan, health plan, or other welfare benefit covered by ERISA, longer retention rules apply. Section 107 requires records supporting plan filings, including copies of Form 5500, nondiscrimination test results, financial reports, and fidelity bond documentation, to be kept for at least six years after the filing date of the report they support.

Section 209 separately requires records sufficient to determine benefits due to each employee: personal information, employment dates, compensation history, contribution amounts, and distribution records. Section 209 does not fix a retention period, so the practical rule is that benefit-determination records should last as long as any participant or beneficiary could file a claim, which can run well past six years for retirement plans with vested participants.

A Note on OSHA Records

OSHA injury and illness records are safety documents rather than payroll files, but they often intersect with pay because they track lost workdays and restricted-duty time. Employers required to maintain them must save the OSHA 300 Log, the annual summary, any privacy case list, and the OSHA 301 Incident Reports for five years after the end of the calendar year they cover.⁸

State Rules Can Extend the Deadlines

Federal retention periods are a floor. State requirements for payroll and employment records range from three to six years, and some states tie the window to the local statute of limitations for wage claims or breach of contract rather than naming a fixed period. Several states require five or six years, which is meaningfully longer than the FLSA baseline.

State unemployment insurance programs set their own rules. Across the 50 states, unemployment tax record retention runs from three to six years, with four years the most common. Check your state labor department and tax agency directly to confirm the longest applicable period.

The cleanest approach is to identify the longest retention requirement that applies to your business, federal or state, and use it as your default across all payroll records. For most employers, keeping complete payroll files for at least six years after the last entry or the employee’s separation, whichever is later, will cover nearly every requirement in force.

Electronic Storage

Paper is not required. Under the FLSA, payroll records can sit on microfilm or in an electronic data processing system, provided reproductions are clear, identifiable by date or pay period, viewable with available equipment, and reproducible as transcriptions or copies on request.¹ The IRS also permits electronic storage as long as records stay legible and accessible.

If you use payroll software, make sure data can still be read and printed after you change vendors or upgrade platforms. Migrating without preserving historical records in a usable format is a common and expensive mistake.

Secure Disposal

Records that have passed their deadline cannot go straight into the trash. Payroll files contain Social Security numbers, addresses, and financial data. The FTC’s Disposal Rule under the Fair and Accurate Credit Transactions Act requires anyone holding consumer information for a business purpose to take reasonable steps against unauthorized access when disposing of it.⁹ Reasonable methods include burning, pulverizing, or shredding paper; destroying or erasing electronic media so the data cannot be recovered; and using a document destruction contractor after vetting their procedures. Applying the same standard to all payroll files, even those outside the rule’s technical scope, is sensible practice.

What Happens if Records Are Missing

Failing to keep required payroll records changes who wins a wage dispute. The Supreme Court held in Anderson v. Mt. Clemens Pottery Co. that when an employer fails to maintain adequate records, employees can prove unpaid wages using their own testimony or estimates. Once the employee presents a reasonable approximation of hours worked, the burden shifts to the employer to disprove it.¹⁰ That is nearly impossible without records.

The Department of Labor can also assess civil monetary penalties for willful or repeated FLSA violations found during investigations where records are missing or incomplete.¹¹ The IRS imposes its own penalties for missing employment tax records, and missing I-9 forms carry per-violation fines. If a discrimination charge is filed and the personnel records that should have been retained are gone, the absence itself can be used against you.

The cost of holding records for a few extra years is small compared to defending a claim without the documentation to answer it. When in doubt, keep them longer.

1
eCFR. 29 CFR Part 516 – Records to Be Kept by Employers
2
eCFR. 29 CFR 516.6 – Records to Be Preserved 2 Years
3
Internal Revenue Service. Employment Tax Recordkeeping
4
Internal Revenue Service. Publication 15 (2026), (Circular E), Employers Tax Guide – Section: Recordkeeping
5
USCIS. 10.0 Retaining Form I-9
6
U.S. Citizenship and Immigration Services. Retention and Storage
7
U.S. Equal Employment Opportunity Commission. Recordkeeping Requirements
8
OSHA. 29 CFR 1904.33 – Retention and Updating
9
eCFR. 16 CFR Part 682 – Disposal of Consumer Report Information and Records
10
Justia Law. Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 (1946)
11
U.S. Department of Labor. Handy Reference Guide to the Fair Labor Standards Act