Keeping Proper Employee Records
As an employer, you are obliged to keep proper employee records and payslips under Sections 535 and 796 of the Fair Work Act 2009 (“Act”). This also applies to the employment of casual and contractor employees, who normally work for a company for short, limited periods of time.
Section 712 of the Act mandates that a Fair Work Officer may require you to produce any record or document at anytime and you must comply with such request.
Proper records must be produced in accordance with the form stipulated by the Fair Work Regulations 2009 (“Regulations”) and kept for at least seven years. For example, every payslip must include the employer’s and employee’s names, period to which the payslip relates, date of payment, and gross and net amounts of payment.
We have summarised the criteria relating to certain employee records below. For a complete detailed checklist, please refer to the Part 3-6, Division 3 of the Regulations.
Records relating to employee’s pay must include the following:
Rate of remuneration;
Gross and net amounts of payment;
Any deduction made from the gross amount;
Any incentive-based payment, bonus, loading, penalty rate or other monetary allowance and entitlement.
Records relating to employee’s work hours must include the following:
Any agreement between employer and employee regarding averaging hours of work;
If a penalty rate or loading is applicable, the number of overtime hours worked by an employee and the start and end times of the overtime work period.
Records relating to employee’s leave entitlement:
Any leave taken by an employee;
The balance of an employee’s leave entitlement;
Any agreement allowing an employer to cash out an accrued amount of leave and if so, the rate of payment and when the payment was made.
Records relating to superannuation contributions:
Amount of contributions;
Period over which contributions were made;
Date of each contribution;
Name of superannuation fund to which contributions are made;
Any document relating to an employee’s election regarding the fund to which contributions are made.
Failure to produce records or documents upon request, or knowingly or recklessly providing false or misleading records or documents may incur a penalty of up to $133,200 for an individual or $666,000 for an organisation.