Record-keeping obligations
As an employer, you have certain obligations concerning the maintenance and retention of employee records.
As outlined in the Penalties Summary module, there are a range of penalties that apply where an employer fails to comply with their record-keeping obligations.
Retaining employment records is not just important for complying with your legal obligations towards employees; they are also essential for protecting your business. If an underpayment claim were made against your business, it is essential that you have retained appropriate records to demonstrate that the employee was paid correctly.
What form do employment records need to be kept in?
Employment records must be:
- legible;
- in English; and
- written or electronic – if electronic, it must be printable.
What are the employment records that I am required to keep?
If an industrial instrument (an award or enterprise agreement) applies to an employee’s employment, certain records must be kept. Click on the red markers below to view the information required.
Key employment information
- the employee’s name;
- if the employees is under 21 years of age, their date of birth; and
- the date that the employee commenced work for the employer.
For each day the employee performs work
- the time that the employee started work and the time that the employee finished work;
- the periods of time that the employee was paid for performing work (i.e. times that the employee was not on an unpaid break); and
- details of work breaks including meal breaks.
For each pay period
- an employee’s employment type (i.e full-time, part-time, casual, etc.);
- the employee’s classification under the applicable award or enterprise agreement (otherwise referred to as a “designation”);
- the gross and net amounts paid to the employee; and
- any deductions made from the employee’s pay and the reasons for them.
Accurate and detailed payslips are essential to achieve record-keeping compliance. The payslip you are about to see is included for the purposes of example and learning. It is not intended to be used as a template.
Instead, it highlights some information required to be included within payslips as well as providing best-practice tips.
It is important to include the date range covered by a payslip. This is commonly referred to as a "pay period".
Because you do not need to specify the exact days or times to which each specific payment relates (including any annual leave or public holidays), this date range helps employees to understand why certain payments have been made.
It also helps identify whether the date of payment complies with timeliness requirements of the applicable industrial instrument.
Payment DateIndustrial instruments will typically require that wages be paid, within a certain time from the end of the pay period, for example within two days of the end of the pay period.
It is therefore important to record the date of payment to show compliance with this requirement.
Payment AmountYou need to include both the gross (before tax) and net (after tax) amounts on an employee's payslip.
An employee’s gross pay includes any ‘pay as you go’ (PAYG) withholding required by the ATO.
Employee statusAn employee's status may either be full-time, part-time, or casual. The employee's status forms part of their "designation" for the purposes of the legislation.
AwardIncluding details of the modern award or enterprise agreement that covers an employee ensures that both you and the employee are clear on the industrial instrument that applies.
Further information about modern award and enterprise agreement coverage can be found here.
ClassificationAn employee’s classification under an award or agreement is effectively their job. Each classification level also attracts a different minimum rate of pay.
If you are paying an employee in line with your award or agreement, each payslip you issue should reflect the correct minimum rates of pay.
Further information about classifications can be found here.
Hourly rateWhen stated on a payslip, this amount should not include any penalties or loadings.
This is sometimes referred to as the 'base rate'. If you are paying in line with the minimum rates of pay in an award, this amount will increase periodically, usually from 1 July.
DescriptionSome payroll software will be preconfigured for your award, and will already include all of the relevant pay codes. However, it is ultimately your responsibility to make sure your employees have been paid correctly.
Annual LeaveAwards and agreements may require employees to be paid a 'loading' while on annual leave.
This is an additional amount that an employee receives simply for being on annual leave.
All leave taken, whether paid, partially paid or unpaid, must be recorded.
Basic hourlyThis is the number of hours worked by an employee which attracts the 'base rate' referred to above - that is, all hours which are not payable at a penalty rate.
Sunday hourlyWhere an employee becomes entitled to receive an additional payment based on when work is performed (commonly known as a 'penalty'), this should be listed separately on their payslip to show that the conditions of the award or agreement have been complied with.
Common examples include evening penalty, Saturday penalty, Sunday penalty.
BreakageAny deductions from an employee's pay, and the reasons for them, must be recorded.
Deductions may only be made from an employee's pay if they are authorised, either by the employee themselves, the terms of their contract, industrial instrument, statute, or by a court.
Personal leave payAll leave taken, whether paid, partially paid, or unpaid, must be recorded.
TaxAs a deduction from pay, the amount of tax withheld from an employee's pay must be recorded.
Superannuation GuaranteeYou will generally be required to make superannuation guarantee contributions if an employee's 'ordinary time earnings' exceed $450 per month gross (before tax) and the employee is either:
- over 18 years of age; or
- works over 30 hours per week.
Recording the amount of superannuation paid on a pay slip assists in demonstrating that you have complied with your obligations. Some industrial instruments specifically require that employee's be provided with a statement of superannuation contributions as well.
WA award/industrial agreement specific records
The industrial instrument(s) applicable to your business and employees may include other types of specific records that are required to be kept, for example requirements to retain details of an employee’s address or to retain rosters that applied to the employee. Be sure to review your WA award or industrial agreement to identify if there are any specific records that you are required to keep.
What about award/agreement free employees?
For award/agreement free employees, the following employment records need to be kept:
Key employment information
- the employee’s name;
- if the employees is under 21 years of age, their date of birth; and
- the date the employee commenced work for the employer.
Hours of work
- the total number of hours worked by the employee in each week of the employee’s employment (unless the employee has a contract of employment with an annual salary exceeding $45,000).
Employee pay
- the gross and net amounts paid to the employee under the contract of employment; and
- all deductions made from the employee’s pay and the reasons for them.
Leave entitlements
Regardless of whether an employee is covered by an industrial instrument or not, an employer must retain employment records that reflect all leave taken by the employee (regardless of the type of leave or whether the leave was paid or unpaid).
An employer must also retain records that contain the information necessary for the calculation of long service leave; this includes information such as an employee’s commencement date and the employee’s time and attendance data.
What records need to be kept for superannuation contributions?
Employers must maintain a record of superannuation contributions specifying:
- the amount of the contributions made and how it was calculated; and
- that each eligible employee has been given a copy of the Australian Tax Office's Superannuation Standard Choice Form.
Should you have any questions concerning how to calculate superannuation contributions or further records you may be required to keep in respect of superannuation payments you should refer to the Australian Taxation Office’s resources for employers.
How long do employment records need to be kept for?
All employment records for current and former employees need to be retained for at least seven years from the date that the record is made. However, records that relate to an employee’s long service leave must be retained for at least seven years from the end of the employee’s employment with the business. Superannuation records currently only need to be retained for five years.
What penalties apply for failing to meet record-keeping requirements?
The Industrial Magistrates Court can apply penalties worth thousands of dollars for not retaining the required employment records. Penalties also apply if an employer fails to produce an employment record or provide one that may be relevant to any associated Court proceedings.
Inspection and copying
If an employee or former employee makes a request to their employer to inspect or copy any of their employee records, the employer must make a copy available for inspection and copying.
The employer must comply with the request by no later than:
- the end of the next pay period after the request is received; or
- the seventh day after the day on which the request was made to the employer.
Industrial inspectors in WA have the power to require the production of records by a specified timeframe. Authorised representatives of unions also have the power to investigate suspected breaches of WA awards and enterprise agreements, and can inspect some records provided they have given written notice beforehand.
If the employer is no longer obliged to retain the record (i.e more than seven years have passed) then there is no obligation to comply with the request.
Should you have any questions about your record-keeping obligations further information can be obtained from the Department of Mines, Industry Regulation and Safety.
