Yes, you can scrap physical files and maintain everything electronically but there may be some files which may be needed during some external audits which needs to be physical copies. So, it’s better that you understand from your CA what type of files can be kept physically and what can be completely transferred electronically. Also check with your senior management regarding the same.
This depends on which records come under your definition of ‘personnel files’.
As you know, the employer have to maintain certain records as a part of statutory obligations, for e.g., records to be maintained under the provisions of Companies Act, Employment Laws, Tax Laws, etc.
You may refer to Records Retention Obligations of Employer that gives an idea about the statutory records to be retained.
Also, you have to refer to the corresponding laws to understand whether such records are to be retained in physical form and which are the records permitted to maintain in electronic form (if yes, how many years’ of records, for how long, etc.).
As a COVID consequence, most of such statutory obligations are progressing towards electronic records, however, it is better to verify prior disposal/destruction of any physical records.
Other than the mandatory records that are to be retained, all other records are under the discretion of the organization’s record retention policy as to:
Which records are to be maintained;
How the records are maintained;
Period of record retention;
Destruction/Disposal of records - modes of destruction/disposal;
Data destruction registry;
Authorized persons to perform the above actions, etc.
Prior migrating from physical to electronic records, followed by a destruction, suggest you consider on the above parameters and move forward.
A consultation with your legal, CS, CA team will give you a clear picture.