A regular question for most business owners is “how long do I have to keep staff records?”
The answer is – it depends… however, the records should be in plain English, easy to read and not altered in any way.
Employment Records – 7 Years:
If you employ people under a modern award or agreement, you need to keep each employee’s time and wages records for at least seven years. The seven years is to ensure records are available to calculate any Long Service Leave for employees.
- Employee’s name & personal details.
- Employee’s commencement date.
- Whether the employee is full-time, part time or casual.
- Whether the employee is permanent or temporary.
- Pay rate paid to the employee.
- Gross and net amounts paid (inc payslips).
- Any deductions from the gross amount.
- Details of any incentive-based payment, bonus, loading, penalty rate, etc.
Hours of work
- Any penalty rates or loadings paid to employees for overtime hours worked, including:
- the number of overtime hours worked by an employee during the day
- when the employee started and finished the overtime hours
- The hours an employee works if the employee is a casual or irregular part-time employee who is paid based on time worked.
- A copy of the written agreement if an employer and employee have agreed to an averaging of the employee’s work hours.
- Any leave taken.
- How much leave an employee has.
- A copy of the agreement to cash out any amount of leave.
- A record of how much was paid, the amount of leave cashed out and when the payment was made.
Tax Records – 5 years:
The ATO requires all employee and contractor records be kept for five years. Records may be paper or electronic and must be in English.
- Copies of tax file number declarations and withholding declarations
- Copies of any contracts you have with contractors
- Records of wages, allowances and other payments made to workers (inc rosters/timesheets)
- Copies of payments (payslips) and reports provided to the ATO.
- Copies of Annual Payment Summaries.
- How you calculated the amount of super you contributed for each employee.
- That you’ve met your choice of super fund obligations.
Fringe benefits tax
- Taxable value of each fringe benefit provided to each employee and how it was determined.
- Justification of claims for exemptions or concessions that reduce your FBT liability.
- Fringe benefits provided by an associate. That associate is required to supply these records within 21 days of the end of the FBT year.