Fair Work Record Keeping Basics

Employment records feel like paperwork about the past — until a dispute turns them into evidence. When a former employee claims they were underpaid, the first question is not who is right. It is: what do the records show? And if the answer is "not much", the rest of the conversation goes badly for the employer, for a reason many owners have never heard of.

The records Fair Work expects

• General: the employee's name, start date, and whether they are full-time, part-time or casual, permanent or fixed-term.
• Pay: the rate paid, gross and net amounts, deductions, and any loadings, allowances, bonuses or penalty rates.
• Hours: overtime worked where it affects pay, any agreement to average hours, and for casual or irregular employees, the hours actually worked.
• Leave: leave taken, balances, and any cash-out agreements.
• Super: contributions made, when, to which fund, and on what basis.
• Ending employment: who ended it, how, and what notice was given.
• Agreements: individual flexibility arrangements, guarantees of annual earnings and similar documents.

Time and wages records are commonly required to be kept for seven years — check the current Fair Work requirement — and they must be legible, in English, and readily accessible if an inspector asks. "The old system we no longer have access to" is not a location.

Payslips have their own rules

Payslips must be issued within a short window after each payday — commonly cited as one working day, but check the current Fair Work rule — and must contain prescribed details, including the pay period, rates, gross and net pay, deductions and super information. Modern payroll software produces compliant payslips automatically; the failures we see are usually payslips not being sent at all, or wage payments made outside the software with no payslip behind them.

Check the award before you set anything up

Most employees are covered by a modern award or an enterprise agreement, and the classification within it drives the minimum rate, allowances, penalty rates and overtime. Paying "above award" does not switch any of this off: a flat rate that looks generous on a Tuesday morning can still underpay a Saturday night once penalties are counted, and the records are what prove it either way. Identify the award and classification in writing when each employee starts, and revisit it when duties change.

Why gaps are more dangerous than they look

In underpayment proceedings, where an employer was required to keep a record and failed to, the burden can effectively reverse: the employer may have to disprove the employee's claim about hours and pay, rather than the employee having to prove it. In practice, that means an employee's own diary or reconstruction can become the starting point, and the business has nothing to answer it with. Record-keeping failures can also attract penalties in their own right, separate from any underpayment.

What we commonly see go wrong

• Salaried staff with no record of hours at all, on the assumption a salary makes hours irrelevant. It does not, particularly where an award still applies.
• Records living in a departed manager's spreadsheet, a personal phone, or a system whose subscription lapsed.
• Casual hours reconstructed from memory at pay time instead of captured from rosters or time clocks.
• No written record of which award and classification each employee sits under.

A worked example

As an illustration: a café pays its casual staff a flat hourly rate, with rosters that change on the day and no time records kept. A former employee later claims unpaid weekend penalty rates covering roughly two years, supported by a personal diary of shifts. With no employer records to answer it, the diary effectively sets the hours, and the business settles on numbers it has no way to test. The flat rate may even have been roughly fair — but without records, "roughly fair" is not something anyone can demonstrate.

When to get help

If you cannot say which award covers each employee, if hours are not being captured anywhere for casuals, or if your records are scattered across old systems and spreadsheets, it is worth fixing the framework once: payroll software as the single home, time capture that matches how the business actually rosters, and a written award classification for each role. It is far cheaper than meeting an inspector — or a diary — unprepared.

How long do employee records need to be kept?

Time and wages records are commonly required to be kept for seven years — check the current Fair Work requirement. Keep them legible, in English and retrievable, including after you change payroll systems.

Do I need time records for salaried employees?

Often yes. A salary does not remove award coverage or record-keeping obligations, and where hours affect entitlements — overtime, penalties, annualised salary reconciliation — records of hours are what protect both sides. Check what the applicable award requires.

What happens if my records are incomplete and a claim is made?

In underpayment proceedings the burden can effectively shift to the employer to disprove the claim, so the employee's own reconstruction may become the starting point. Incomplete records can also attract penalties separately. Start keeping proper records now — the gap only grows.