Under the Fair Work Act and Regulations (Act) employers are required to make and retain accurate records for all of their employees and issue payslips to an employee every time they are paid. Failure by an employer to comply with these obligations may attract a fine of up to $3,300 for an individual or $33,000 for a corporation.
Set out below is a summary of the minimum information an employer must record.
- The employer’s name.
- The employer’s Australian business number.
- The employee’s name.
- The employee’s commencement date.
- The basis of the employee’s employment (full or part time and permanent, temporary or casual).
- The rate of remuneration paid to the employee (eg. annual salary or hourly rate).
- The gross and net amount paid to the employee each pay period.
- In the case of a salaried employee, the total amount paid in that financial year up to the last day of the pay period.
- In the case of an employee who is paid an hourly rate, a record of the hours worked by the employee in that pay period.
- Any deductions to be made.
- Details of any incentive based payment, bonus, loading, overtime penalty rate or other monetary allowance or separately identified entitlement paid to the employee.
- The record must record the number of hours worked each day and should include start and finish times.
- If a penalty rate or loading is to be paid for overtime hours worked, the record must identify the normal hours and the overtime hours worked each day, and when the employee started and finished working overtime hours.
- If the employer and employee have agreed to an averaging arrangement for the employee’s hours over the year, there must be a written agreement confirming this arrangement.
- Records all leave taken by the employee.
- The record must show the balance of the employee’s leave entitlements at the conclusion of each week.
- If the employer and employee have agreed to cash out a portion of the employee’s accrued annual leave or long service leave, the employer must keep a copy of the written agreement signed by the employee confirming the cashing out of leave.
- The agreement must contain:
- employee’s name;
- amount of leave being cashed out;
- rate of payment for the cashed out leave; and
- when the cash out payment was made.
- The amount of the contribution made on behalf of the employee.
- The dates on which each contribution was made.
- The period of which the contributions cover.
- The name of the fund to which the contributions were made.
- The basis on which the employer became liable to make the contributions.
- A record of any election made by the employee (including the date) to have any superannuation contribution paid into a particular fund.
- If the employer and employee have agree to an individual flexibility arrangement in relation to a modern award or an enterprise agreement, the agreement must be in writing and include the following:
- the names of the employer and employee;
- the signatures of the employer and employee;
- the complete terms of the agreement;
- details of how the arrangement varies the terms of the modern award or enterprise agreement;
- details of how the employee is better off overall in relation to the terms and conditions of his or her employment as a result of the agreement; and
- the date on which the agreement will commence.
- A copy of any notice terminating the flexibility agreement.
Where the employee’s employment has been terminated, the record must identify:
- whether the employment was terminated by consent, by notice or some other manner (specifying that manner);
- the name of the person who terminated the employment; and
- the termination payment.
- The employer’s name.
- The employer’s ABN.
- The employee’s name.
- Date of the payment.
- The pay period to which the payslip relates.
- The gross and net amounts of payment.
- Any bonus, loadings, monetary allowances, overtime loadings, penalty rates or other separately identifiable payments included in the payment.
- Details of any deductions, identifying if they are pre or post tax deductions.
- If the employee is paid an hourly rate, the hourly rate and the amount of hours worked in that pay period.
- If the employee is paid an annual salary, the total amount paid in that financial year up to the last day of that pay period.
The Act requires that the employer must retain all employee records for a period of seven years.
Who may view the records?
- Employee records are private and confidential and generally may only be accessed by the employee, their employer and relevant payroll staff.
- Employers must make copies of an employee’s records available at the request of an employee or former employee.
- However, Fair Work Inspectors and organisation officials (such as a trade union offical) may access employee records (including personal information) to determine if there has been a contravention of relevant Commonwealth workplace laws.
Should you wish to know more about this topic please contact either partner Ian Curlewis on (08) 9288 6756 / firstname.lastname@example.org or senior associate Michael Jensen on (08) 9288 6944 / email@example.com.
This snapshot is intended only to provide a summary of the subject matter covered. It does not purport to be comprehensive or to provide general legal advice or legal advice to an individuals particular needs. No reader should act on the basis of any matter contained in this publication without first obtaining specific professional advice.