Record Keeping and Pay Slips

Under the Fair Work Act 2009 (Cth) (FW Act), employers are obligated to keep complete and accurate records for each of the employer’s employees and provide certain information on pay slips.

The purpose of requiring complete and accurate record keeping is to facilitate and ensure employees receive their correct entitlements.

What records must be kept?

There are several record-keeping categories that must be maintained, although some categories may not be relevant for all employees (e.g. if no flexible work arrangement requests have been made).

The categories of records and content include:

  • general employment information of the employee: employer’s name (and from January 2010, the ABN), the employee’s name, if the employee is full-time or part-time, if the employee is permanent, temporary or casual, and the employment start date;
  • pay records: rate of remuneration, gross and net amounts paid, any deductions made from the gross amount, and details of the employee’s entitlements for incentive-based payments, bonus, loading, penalty rate or any other monetary allowance or separately identifiable entitlement, and for employees that are casual or irregular part-time employees and are guaranteed a rate of pay based on time worked, the record must set out the hours worked by the employee;
  • overtime: the number of overtime hours worked each day or when the employee started and ceased working overtime hours;
  • averaging of hours: if the employer and the employee agree to an averaging of the employee’s hours of work, a copy of the agreement;
  • leave: any leave the employee takes, the balance (if any) of the employee’s leave entitlements from time to time (i.e. as the leave is accrued and taken);
  • cashing out leave: a copy of the agreement in respect of cashing out leave, the rate of pay for the amount of leave cashed out and when the payment was made;
  • superannuation contributions: the amount paid, the period over which the payments were made, the date each payment was made, the name of any fund the payment was paid into, the reason the employer paid into that fund (e.g. a record of the employee’s superannuation fund choice and the date of such choice);
  • individual flexibility arrangements: a copy of the agreement in respect of the individual flexibility arrangement, and any notice or agreement terminating that arrangement;
  • guarantee of annual earnings (only applicable for employees on or over the high-income threshold with an arrangement that the employee does not receive award entitlements): a copy of the agreement in respect of the guarantee of annual earnings, and record of, and date of, a revocation; and
  • termination of employment: a record of whether the employment was terminated by consent, by notice, summarily or another manner (and what that is) and the name of the person who acted to terminate the employment.

What are the record-keeping obligations?

General obligations relating to the records include: that the record must be legible and in English, be readily accessible, kept for 7 years, only altered to correct an error and an entry must not be made that is known to be false or misleading.

Who can access the records?

Employment records are private and confidential and access to the records should not be provided, except as permitted by law. The employment records can be accessed by the employer, the employee the record is about and a person conducting payroll (as necessary).

The FW Act also provides that employment records can be accessed by a Fair Work inspector and a person holding an entry permit (union officials), to access records for a suspected contravention.

Pay slips

Play slips must include the following information:

  • employer’s name (and from January 2010, the ABN), the employee’s name, the pay period, date of payment, gross and net amount of payment, any amount paid to the employee (that is a bonus, loading, allowance, penalty rate, incentive-based payment or other separately identifiable entitlement);
  • for hourly rates of pay, the ordinary hourly pay rate, the number of hours the employee was employed at that rate and the payment made at that rate, or for an annual rate of pay (salary), the rate as at the last day in the pay period;
  • for deductions from gross pay the name and/or number and fund/account into which the deduction was paid; and
  • for superannuation contributions, the amount made or intended to be made for the pay period and the name and/or number of the superannuation fund the payment will be made to.

Importantly, no reference to information on paid family and domestic violence leave may be included on the pay slip.

Compliance with obligations

If a business fails to comply with their record-keeping and pay slip obligations, a Fair Work inspector may issue an infringement notice (within 12 months of the contravention). Alternatively, the matter may be referred to a court (e.g. where it is considered the failure is wilful, serious or repetitive). Penalties imposed by a court are likely to be higher if the court finds that the contravention is serious, being that they occurred knowingly and the contravention is part of a systematic pattern of conduct.

Take aways

The key takeaways are:

  • employers have an obligation to maintain employment records and provide information on pay slips;
  • access to employment records is restricted; and
  • non-compliance may attract an infringement notice or court-ordered penalties.

Member service

Employer Assist provides advice on all aspects of employment law.

Please contact Employer Assist on (07) 3376 6266 or if you have any questions relating to this article or to discuss any employment issues that arise in your business.

Liability limited by a scheme approved under the professional services legislation.

This document is intended for general information purposes only and should not be regarded as legal advice. Please contact Employer Assist if you require advice.

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