An employer's record-keeping obligations are important.
However, because they are generally seen as fundamental or
rudimentary (and because often reliance is placed on payroll
software and applications to manage the obligations), some of the
finer details are often forgotten or missed.
Here are ten key things to remember about employee
General employment records must contain:
the employer's name and ABN (if any)
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).
Pay records must contain:
the rate of pay
gross and net amounts paid
details of any loadings, penalties, allowances, bonus or
incentive payments or other separately identifiable entitlements
Where there is an entitlement to leave (so, generally not in
relation to casuals) the record needs to include leave taken and
the balance of the employee's accrued entitlement.
Also, where an arrangement for cashing out leave exists, the
employer must retain a copy of the agreement to cash out, a record
of when the payment was made and a record of the rate of
Obligations as to record-keeping for leave exist not only in the
Fair Work Act 2009 (Act) but also in the
long service leave legislation applicable in the relevant State. In
Victoria, records must be kept (in the form approved by the
Department of Economic Development, Jobs, Transport and Resources
(available at business.vic.gov.au)) of
date of commencement
date first eligible
adjusted date (if applicable)
the period of leave taken (start and end dates)
the number of weeks taken
the rate of ordinary pay at time of taking leave
Records as to superannuation
Where an employer must make superannuation contributions for an
employee, unless the contribution is a defined benefit interest in
a defined benefit fund, the record must contain details as to:
the name of the fund and details (including the date) of any
election made by the employee to have their contributions paid into
the amount of the contribution paid and the basis on which the
employer became liable to make the contribution, and
the date on which the contribution was paid and the period to
which the payment relates.
Where the employment has been terminated, the employer must keep
records which contain information as to the manner in which the
employment was terminated (i.e. by consent, summarily, on notice)
and the name of the person who terminated the employment.
Records of Individual flexibility
If an employer and an employee have agreed to an individual
flexibility arrangement by reference to an award or enterprise
agreement, a record of the arrangement must include a copy of the
agreement and any documents relevant to terminating the
Records as to Guarantee of annual
Where an employer has given a guarantee of annual earnings, the
employer must make and keep records of both the guarantee and the
date of any revocation of the guarantee.
Making records available
Employers must make copies of an employee's records
available at the request of an employee or former employee.
Employee records must be kept for seven years.
Employer non-compliance with record- keeping
Perhaps the reason to remember the nine other key things, an
employer who does not comply with its record keeping obligations
risks being issued with an infringement notice under the Act. An
infringement notice can be issued within 12 months after the day on
which a contravention occurred.
Infringement notices presently carry a maximum fine of $2700 per
contravention for a company and $540 per contravention for an
individual. That may not seem like a huge amount by reference to
some of the other penalty provisions of the Act, but note that it
is $2700 (or $540, as the case may be) per contravention. This is
significant, because in the arena of record-keeping, chances are
that if an employer "gets it wrong" for one employee,
they get it wrong for all employees – and the fine can be
multiplied by the number of employees in respect of whom the
employer got it wrong.
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.Madgwicks is a member
of Meritas, one of the world's largest law firm
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An employee that refused a reasonable offer of settlement was ordered by the FWC to pay his ex-employer's legal costs.
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