Employment Records – What are our obligations?

By Erin Verzandvoort

Senior Employee Relations Adviser

The Fair Work Act 2009 (Cth) (FW Act) governs a national system employers’ record keeping obligations when it comes to employees. The FW Act states that an employer must make, and keep, employee records (as prescribed by the Fair Work Regulations 2009 (FW Regs) in relation to each of its employees for 7 years. Employers must make and keep records relating to the following (this list is not exhaustive): 

  • Basis of employment (i.e. full time, part time or casual)
  • Wages
  • Overtime hours worked
  • Averaging of hours arrangements
  • Leave entitlements
  • Superannuation contributions 
  • Individual flexibility arrangements
  • Guarantee of annual earnings
  • Termination of employment
  • Transfer of business  

It is the responsibility of the employer to ensure all records are in a legible form, in the English language and readily accessible. An employee record must be made available for inspection and copying on request by an employee or former employee to whom the record relates. Fair Work inspectors also have the right to inspect and copy employee records.

Payslips

National system employers must ensure pay slips are up-to-date and readily accessible to employees and Fair Work Inspectors. Industrial Awards, Contracts of Employment and Enterprise Agreements should be consulted in conjunction with the FW Act & the FW Regs.

What information is required on a payslip?

  • Employer’s name;
  • Employee’s name;
  • The period to which the pay slip relates;
  • The date on which the payment to which the pay slip relates was made;
  • The gross amount of the payment;
  • The net amount of the payment;
  • The amount paid to the employee that is a bonus, loading, allowance, penalty rate, incentive-based payment or other separately identifiable entitlements; and
  • The ABN of the employer.

Long Service Leave

Employers, in Western Australia, need to be aware there are additional obligations regarding employment records for the purpose of long service leave governed by the Long Service Leave Act 1958 (LSL Act).

An employer must keep records that specify:

  • The employee’s name and if the employee is under 21 years of age, the employee’s date of birth;
  • The date the employee commended employment with the employer;
  • The gross and net amounts paid to the employee including any deductions and the reason for those deductions;
  • All paid and unpaid leave taken by the employee;
  • Details of any agreement between the employee and employer to contract out of long service leave made under section 5 of the LSL Act;
  • Each record must be retained during the employment of the employee and for not less than 7 years thereafter.

The Privacy Act

The Privacy Act 1988 (Cth) (Privacy Act) regulates the collection, use and storage of personal information in Australia. From an employment perspective, the Privacy Act only has application to information collected before the employment relationship has begun or to information collected during the employment relationship that does not relate to the employment relationship itself.

Once an employee has commenced employment and after they have ceased employment, any personal information collected relating to their employment will not be regulated by the Privacy Act. It is therefore primarily the recruitment process that is governed by privacy laws, in particular where an applicant is unsuccessful. In such instances, applicants may wish to access this information as evidence in lodging a general protections or discrimination claim against the business for failure to progress through the recruitment process or failure to employ. 

Presumption Where Records Not Provided

Section 557C of theFW Actwasintroduced in 2017, imposing reverse onus of proof on employers where they have not made and/or kept relevant employment records. The new provisions provide that, where an employer has not made or kept employment records and/or made these available for inspection, they hold the burden of disproving contravention allegations.

Case Example

A former casual cook and guest services worker of Karriview Management Pty Ltd submitted a claim to the Industrial Magistrates Court for underpayment of working long hours without compensation. In the decision the Court determined the underpayment claim lacked credibility and therefore the employees only worked 18 and 15 hours respectively. The Industrial Magistrates Court ordered the employer to back pay the couple $10,165.

The employees lodged an appeal to the decision, which was heard by Justice Craig Colvin in the Federal Court. Justice Colvin overturned the decision on the finding that the Industrial Magistrates Court misapplied section 557C of the FW Act. Justice Colvin found that, had section 557C been applied correctly, the employees claims should have been accepted due to the fact that Karriview Management Pty Ltd failed to procedure or keep relevant required employment records nor did they appropriately disprove the employees claims. The appealed was upheld on these grounds and Justice Colvin ordered the employer back pay the couple $21,314.

Like to know more? Contact CCIWA’s Employee Relations Advice Centre on (08) 9365 7660 or email advice@cciwa.com

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