employment record keeping

Records. If only I’d known….

Records – in particular, records relating to employment.

*yawn*

But….what if we told you this is often the one area that employers wish they’d paid attention to before they were hit with penalties by an industrial regulator?

In our travels, we regularly see missed record keeping requirements that would fail an inspection by an industrial regulator. For example, not having the correct pay level recorded, no date of commencement of employment…or there being no record of the termination of employment!

This becomes even more of a problem if you’ve bought a business and the seller has not provided you with compliant records. How can you hope to account for costs associated with long service leave (for permanent and casual employees) without accurate employment records? The answer is; you can’t.

While on this topic, the maximum (National System) penalty for a body corporate is $6,300.00….per contravention! No guesses as to who ultimately has to foot that bill – the current owner of the business if they’ve not been diligent or had support / protection through the purchasing process.

So what should you do?

There are easy ways to rectify or put in place safeguards for employment record keeping obligations, including:

1. Check what you already have in place

Chances are, if you’re using a book keeper / accountant and an electronic accounting system, you’ll already be meeting many of the obligations relating to payroll and pay slips. Some of the record keeping requirements to check include:

  • Pay (e.g. pay rate paid to the employee, gross and net amounts paid and any deductions from the gross amount)
  • Hours of work (e.g. any penalty rates or loadings paid to employees for overtime hours worked and the hours an employee works if the employee is a casual or irregular part-time employee who is paid based on time worked)
  • Leave (e.g. any leave taken, how much leave an employee has and records relating to the cashing out of leave)
  • Superannuation contributions
  • Individual flexibility agreements
  • Guarantee of annual earnings

2. Know the rules

The rules for employment record keeping can be different to tax or immigration requirements so take a moment to know the basics. Ideally, do this before you purchase a business…

3. Identify ways to capture and keep the information

Both the State and National regulators provide some templates to help businesses with addressing this function and we also provide a form to help employers capture the general information…plus other information you might need from time to time (like emergency contact information and diversity / health matters).

The message to hear…

A key message to take away from this article is that if you get the record keeping information right, you’ll proactively tick off many of the key things that cause employers to come to the attention of an industrial regulator. And if they do come knocking, chances are you will be one of the businesses that pass their audit first time.

Also, and we think more importantly, with basic employment issues in place because of good record keeping, you can instead focus on the humans in your business and activities to help them be the best they can be for your business.

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