Australia: Workchoices And Employee Records Explained

Last Updated: 21 November 2006
Article by Scott McSwan

"Surely the government should be making it easier for business, not harder!"

"Just another set of rules to have to keep!"

Many employers are upset about extra record-keeping obligations.

The good news is that recent WorkChoices amendments have made record-keeping obligations somewhat less onerous for employers than initially expected.

What Records?

Employers must keep the following types of records:

  • General employment information
  • Termination of employment
  • Time and wages
  • Superannuation

There are also detailed rules about information to be stated on pay slips.

In this edition we explain:

  1. How must employee records be kept?
  2. For how long?
  3. What happens if I transfer my business?
  4. The first 2 types of records:
  • General employment information
  • Termination of employment

How must the records be kept?

You will recall from previous newsletters that WorkChoices:

  • has introduced basic employment standards for minimum pay, leave entitlements etc.
  • prohibits unlawful dismissal, for example where an employee is dismissed because of pregnancy, race, sex etc.

(If you need any more information about these, contact us and we can send you previous newsletter editions)

The easiest way to think about record-keeping obligations, is that the employer must keep sufficiently detailed records to prove that the WorkChoices Standards and lawful dismissal rules are being met.


  • Records can be kept either electronically or in document form… so long as they are easy to read.
  • Records about accrued entitlements such as annual leave or sick leave do not need to be immediately "up-to-date", but must be sufficiently detailed to allow the accrual calculation to be undertaken by the inspector.
  • Records must be in plain English.

For how long must these records be kept?

For 7 years.

What if I sell my business and the purchaser employs the employees?

You must transfer to the new employer all records concerning the transferring employee/s. Thereafter those records must be kept by the new employer.

General Employment Information

An employer should ensure that it is keeping the following details:


  • Employers name
  • Employee's name and date of birth
  • The date the employee commenced employment
  • The names of any employment industrial instrument (eg a federal award) under which the employee has an entitlement
  • the employee’s job classification under that instrument
  • whether the employee works part-time or full-time
  • whether the employee is permanent, temporary or casual
  • if the employee is part-time or full-time, the specified number of hours to be worked each week

Termination of Employment

When an employee’s employment is terminated, the record for the employee must contain:

  • Whether the employment was terminated:
    • by consent;
    • by notice;
    • summarily;
    • if in some other matter, specifying how
  • The name of the person who acted to terminate the employment.

Record-Keeping Obligations continued

In our next edition we explain:

  • Time and wages records
  • Superannuation records
  • Information to be stated on pay slips

Is your Organisation a Constitutional Corporation?

WorkChoices only applies to Constitutional Corporations.

The criteria for a Consitutational Corporation, are that the organization is a corporation, a substantial proportion of the activities of which are trading or financial.

What is a Corporation?

Pty Ltd and Ltd companies are "Corporations".

The following are not Corporations:

  • Sole traders
  • Partnerships

What Is "trading or financial"?

"Trading" is the business of buying, selling, exchanging or bartering goods and services… eg local store sells goods, an accounting firm sells services.

"Financial" means carrying on activities such as borrowing, lending, banking or insurance, and providing management and advisory services in relation to financial matters.

What does all this mean?

The area of greatest complexity is corporations that carry on activities that arguably are not predominantly "trading or financial".

To help you understand this in practice, we set out below details of decided cases, and the legal principles applied, for:

  • Universities
  • Local governments
  • Other (eg church and charity groups)


The University of Wollongong received substantial money from trading activities… and was found to be a trading corporation. It was also found that the activities do not have to be profitable or intended to be profitable.

The University of Western Australia was found to be a trading corporation even though:

  • Trading was not the University's main activity; &
  • It was not created for the purpose of trading

Local Government

The City of Armidale’s domestic rubbish removal service was a "substantial" trading activity… and sufficient for it to be a trading corporation.

In a case involving The Shire of Esperance, the Commission held that a local Council is a constitutional corporation if trading activities make up a significant portion of its revenue.


Even though it had many non-trading activities, The Roman Catholic Archdiocese of Brisbane was found to be a trading corporation.

A company that provided an employment program for people with intellectual disabilities, and was almost entirely funded by government grants, was found not to be a constitutional corporation.

What About Your Organisation?

You can contact us to help you assess whether your organization is a "Constitutional Corporation".

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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