Just for the Record – What you Need to Know About Employee Record Keeping

As business owners and employers you are probably aware that under the Fair Work Act 2009 (Cth) (the FW Act) there lies an obligation to keep correct and accurate employee records. But what you may not know is, that business operators can be personally penalized by the Fair Work Ombudsman for non-compliance. Where an employer fails to make or keep records in accordance with the FW Act an individual may be penalized $5,400 per contravention and $3,600 per contravention for knowingly making false and or misleading records.

The Fair Work Ombudsman has brought and enforced in the courts record penalties against businesses and individuals for breaching their record keeping obligations under the FW Act. One such case which resulted in not only the business owners being fined, but also their payroll team who failed to keep accurate records and were involved falsifying employee records and payroll information (Fair Work Ombudsman v HSCC Pty Ltd [2020]).

So what information do you need to keep?

In general terms employee records can be made up of, but not limited to –

• General records – such as record of employee’s name, commencement date, employment category (full time, part time, casual)
• Pay records – such as rate of pay, gross and net amounts and payroll deductions
• Hours of work – such as hours worked by the employee, overtime hours, written agreement such as a contract and or IFA
• Leave records – such as leave taken by the employee, balance of any outstanding leave, any agreements, and balances of cashed out leave or agreed amounts of leave in advance
• Superannuation contribution records – such as contributions made, date of contributions, period contributions were made over, name of fund contributions were made to, authority given by the employee to make contributions to a particular fund
• Termination records – such as reason for termination such as resignation or summary dismissal, notice provided, name of person who terminated employee

All employee records must be kept for 7 years and be easily accessible in the event a Fair Work Inspector requests access or an employee or former requests a copy of their records.

What about pay slips, does every employee have to get one?

The short answer is yes. You must issue a pay slip to each employee within one working day of the day the employee was paid. This can be issues electronically or paper form.

What information needs to present on a pay slip?

There can be some confusion around what must be included on an employees pay slip and what can be included on the pay slip.

The following are a list of must be included –

• Employer’s name and ABN
• Employee’s name
• Date of payment
• Pay period
• Gross and net amount of payment

• Any loadings (including casual loading), monetary allowances, bonuses, incentive-based payments, penalty rates, or other separately identifiable entitlement paid.

For example, a note could be included on a pay slip that the hourly rate incorporates the relevant casual loading.

Where the employee is paid an hourly rate of pay, this must also be included on the pay slip along with the number of hours worked at this rate. Where the employee is paid a salary, the rate as at the last day in the pay period must be included on the pay slip.

The inclusions of any allowable deductions must also be visible on the pay slip detailing what the deduction was for.

If superannuation contributions are required to be made details relating to the contribution payments are to be included on the pay slip. These include the amount of the super contributions made or is required to be made for that period, name of the superannuation fund which payments have or will be made into.

Should you require further details or assistance in determining what records you need to keep or details that must be on your employees pay slip, the Master Builders Workplace Relations and Legal Team are here to help. Reach out on 02 6175 5900.