Payroll Record Keeping
The Fair Work Ombudsman (FWO) has been doing spot checks on small businesses across six cities to see if employers are keeping proper records. If you have staff, now is a good time to make sure everything is in order.
Around 50 businesses were visited in locations such as Sydney, Melbourne, Perth, Hobart, Adelaide, and Cairns. Inspectors focused on retailers and service businesses such as butchers, florists, bakeries, phone repair shops, beauty salons and car washes. These types of businesses often hire younger staff or migrant workers, who may not always be aware of their rights or feel confident in speaking up.
Inspectors checked pay slips, timesheets, and whether employees had received the correct Fair Work Information Statement and Casual Employee Information Statement. When records were missing or poorly kept, employers received fines on the spot. The penalties can range from $1,878 for an individual issue to $9,390 for a company.
The FWO indicates that missing or sloppy records are often a sign that there could be underpayments or other issues. In the last financial year, they issued 760 fines nationwide, totalling nearly $1 million.
This is not about punishing honest mistakes. It is about making sure businesses are following the law and treating their workers fairly. Keeping good records also makes your life easier when it comes to payroll, audits and sorting out any mistakes quickly.
Reference: FWO – Record-keeping blitz for businesses nationwide
Business Record Keeping Requirements
Employers must keep specific records for each employee. These include basic information such as the employee’s name, start date, employment type (full-time, part-time, or casual), and pay rate. Employers must also record what has been paid, any deductions, and details of extras, such as overtime, bonuses, or allowances. If an employee works irregular hours or overtime, start and finish times must be recorded.
Other required records include leave balances, details of any leave taken, and information on superannuation contributions, including the dates and locations of payment. Additionally, copies of any relevant agreements, such as those for leave in advance or flexible work arrangements, are also required. If employment ends, the employer must document the circumstances and date of termination.
These records must be kept confidential, but employees have the right to request access at any time. Failing to maintain proper records can result in penalties, so it’s essential that everything is accurate and well-organised.
Time and wages records must be kept for seven years. They need to be in English, legible, and readily available if requested by a Fair Work Inspector. Records can only be changed to correct genuine errors. Keeping false or misleading records is against the law and may result in further penalties. Clear and accurate record-keeping protects both the employer and the employee.
If you’re a small business owner, having a trusted bookkeeper is one of the best ways to stay on top of your financial obligations. Bookkeepers bring the right mix of accuracy, experience, and up to date knowledge to help you avoid costly mistakes. They ensure the details are accurate, allowing you to focus on running your business with confidence.
Reference: FWO – Record-keeping
The Role of the Bookkeeper
Professional Bookkeepers offer practical support to small businesses in areas such as record-keeping and compliance. They can review current systems, identify gaps, and recommend simple adjustments to ensure everything is being captured accurately. They help set up and maintain processes for timesheets, pay runs, leave tracking, and super payments, so nothing is missed. They also make sure that employees receive the correct Fair Work Information Statement and Casual Employee Information Statement and that records are stored properly and securely.
If there has been a mistake or something has fallen behind, a bookkeeper knows how to bring things up to date and correct errors without making the situation worse. They can also help business owners understand their record-keeping obligations and know what to expect if a Fair Work Inspector asks questions. Your Professional Bookkeeper will be able to assist you with any matters relating to the importance and understanding of your record-keeping obligations.
FWO Resources
The FWO offers pay slip and record-keeping templates to help employers get it right. The FWO’s Small Business Showcase also offers a range of tailored resources for small business employers. The FWO provides an online learning centre for employees and employers, including this course, which specifically covers record-keeping and pay slips. Small businesses can also audit their own compliance with their obligations with this checklist.
Employees can keep track of their hours worked through the Record My Hours app.
Employers and employees can visit www.fairwork.gov.au or call the Fair Work Infoline on 13 13 94 for free advice and assistance about their rights and obligations in the workplace. A free interpreter service is available on 13 14 50. Information can also be provided to the FWO anonymously, including in 16 languages other than English.
