Are you aware of your record keeping requirements under the Fair Work Act?

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Posted September 23, 2019

Are you aware of your record keeping requirements under the Fair Work Act?

The Fair Work Act 2009 (the Act) requires employers to make and keep certain employee records relating to pay, hours of work and leave entitlements for seven years.

Current and former employees have the right to access their own records. Fair Work Inspectors must also be allowed to access employee records if they request it.

 

What form do records need to be kept in?

The Fair Work Regulations 2009 (the Regulations) state that an employee’s records must:

• be legible, in English and in a form that is readily accessible to a Fair Work Inspector
• be kept for seven years
• be properly maintained and kept accurate at all times
• not be altered unless correcting an error
• not be false or misleading to the employer’s knowledge.

Records can be kept electronically, such as scanned copies for example, if they can be printed on request.

 

What information needs to be kept as an employee record?

The Regulations also set out what must be kept as an employee record. Records must be kept in relation to the following matters:

• General employment details
• Pay
• Hours of work
• Overtime
• Averaging of hours
• Leave
• Superannuation
• Individual flexibility arrangements
• Guarantees of annual earnings
• Termination of employment
• Child employment (under some state and territory legislation).

Some of these matters are considered in more detail below.

General records

General employment records must include all of the following:

• the employer’s name
• the employer’s Australian Business Number (ABN) (if any)
• the employee’s name
• the employee’s commencement date
• the status of the employee’s employment (full-time, part-time or casual).

Pay records

Records of pay must include each of the following:

• the employee’s rate of pay
• gross and net amounts paid to the employee
• any deductions made from the gross amount paid to the employee
• the details of any incentive-based payment, bonus, loading, penalty rate, or other monetary allowance or separately identifiable entitlement paid.

Hours of work and overtime

An employer must keep a record of the hours worked for all employees, including employees who don’t have a regular pattern of work such as casual or irregular part-time employees.

Records about overtime must be kept if a penalty rate or loading was paid on the overtime hours. For overtime hours, the employer must keep a record which states:

• the number of overtime hours worked each day; or
• when the employee started and ceased working overtime hours.

Leave

The employer must make and keep a record that sets out:

• any annual leave or personal/carer’s leave that the employee takes; and
• the balance of the employee’s entitlement to each type of leave from time to time.

If an employee requests their leave balances, this information must be readily available. If agreement was reached to cash out annual leave under the award, the employer must keep both a copy of this agreement as well as a record that shows the pay rate that the leave was cashed out at and the date the payment was made.

Record of superannuation contributions

Superannuation contribution records must also be kept by an employer. The record must contain the following details:

• the amount of the contributions made
• the period over which the contributions were made
• the dates on which the contributions were made
• the name of any fund to which the contributions were made
• the basis upon which the employer became liable to make the contributions, including the keeping of a record of any choice made by the employee of a fund they wanted contributions paid into and the date of when that choice was exercised.

 

Are warnings and performance management documents employee records?

Documents about performance management or warnings are not employee records, so there is no obligation for an employer to share this information with employees. There may be some situations where it is beneficial to share this type of information with employees, such as part of a performance improvement process. Employers should be careful if providing these documents to current or former employees and should seek advice if they receive a request from a current or former employee for these documents.

Breaching these requirements can be costly

Penalties for non-compliance with these obligations were recently significantly increased. Serious contraventions of the provisions can now result in fines of up to $630,000 being imposed upon an employer.

We want to answer your questions

Our workplace advisors are standing by and ready to answer your questions. For further advice or assistance on this topic, or any workplace relations matter, please call us on 02 9221 9911, 8:30am – 5:30pm AEST Monday to Friday.