AHRI:ASSIST FAQS: Managing employee records


What are the legalities of managing employee files? AHRI:ASSIST answers some frequently asked questions.

Q. A union representative wants access to an employee’s file. Is this allowed and is 24 hours’ notice still required?

Under the Fair Work Act, a condition for the union official’s right to request and inspect records relating to your employment or a member of their union is that the record is directly relevant to a suspected contravention of the Fair Work Act, award, enterprise agreement, etc.There’s a 24-hour notice period requirement.

Q. Is there a requirement under the Fair Work Act for staff to complete timesheets?

No, there’s no requirement for staff to complete timesheets. However, employers are obliged to keep certain records, including pay records, records about the type of employment held by an employee and his or her details, leave records and overtime records.

Q. What’s the penalty for a breach or non-compliance?

In the case of a serious breach of the Fair Work Act requirements in respect of employee records a corporate could be liable for up to $25,500 in penalties and an individual $5100.

Further, a breach of the Fair Work Act regulations in respect of record keeping or pay slip requirements may lead to the Fair Work Ombudsman issuing penalties. This can occur within a year of an alleged contravention. The maximum fines for each contravention, which must be paid within 28 days of an infringement notice being issued, are $2550 for a corporation and $510 for an individual.

 Q. What level of ongoing maintenance is required for hard copy documents, electronic storage and so on?

Employee records can’t be altered or allowed to be altered. While this may not necessarily mean that an employer must keep a hard copy of the documents on hand, under current regulations there’s some benefit in keeping the paper record in addition to an electronic record, if that’s the employer’s preferred practice.

Keeping both records will mitigate the possibility of being found to have altered the record where an electronic version is found to be deficient (likewise, keeping an electronic record may help in avoiding losing paper files through flood or fire). To that end, if an employer decides to implement a paper-less record keeping system, the employer should ensure that 100 per cent of the hard copy is recorded from the original and remains readable. Also, preferably archive the originals.

Q. How long do we need to keep our employee records for?

Records that are required to be kept under the Fair Work Act must be kept for seven years.

Q. Can an employee record be inspected?

While an employee record should remain confidential at all times and accessed only by HR managers, employees and former employees or their representatives, such as lawyers or union officials, are entitled to request that the employer provide a copy of their record or some aspect of it. Further, the Fair Work Ombudsman has the power to have its inspectors inspect and copy records.

Q. An employee has requested access to notes the HR manager took when conducting a performance management meeting. Are we obligated to provide them?

No, there’s no obligation to provide them. The employee has no entitlement to them. Of course, they may be discoverable in any court proceeding; however, that’s not a reason to provide them now when no reason has been given. You should refuse, but at the same time indicate a willingness to assist the employee with his/her query if it’s reasonable.

Q. We’re in the process of transferring our business. What are our obligations with regard to our employees’ records?

In a transfer of business situation the previous employer is required to transfer the employment records for each transferring employee upon one of the following occurring:

  • The transfer of business assets;
  • When the work is outsourced or ‘in-sourced’; or
  • For associated entities, when the employee is transferred.

The new employer must ask the old employer to provide them with the employee’s records and the previous employer must provide the records to the new employer

Q. We want to safe-guard against paying allowances and loadings, and we pay higher than award minimums. Can we avoid having to issue individual flexibility agreements with a ‘salary all inclusive’ clause in the employment contracts and do we need to maintain records of this?

You can rely on over-award payments to meet award obligations to pay allowances and loadings in the manner you suggest. You need to be ready to justify the sufficiency of the over-award margin if disputed, with reference to proper time and wages records. Plus you need to be ready to prove compliance with the award if necessary, and you can only do this if you keep sufficient employee records.

If you’re grappling with an HR issue, AHRI:ASSIST is an HR guidance and support centre, with information sheets, checklists, guidelines, templates and much more. 

To find out more about AHRI membership so you can access the full AHRI:ASSIST resource centre, visit the AHRI website.

Leave a reply

avatar
500
  Subscribe to receive comments  
Notify me of
More on HRM

AHRI:ASSIST FAQS: Managing employee records


What are the legalities of managing employee files? AHRI:ASSIST answers some frequently asked questions.

Q. A union representative wants access to an employee’s file. Is this allowed and is 24 hours’ notice still required?

Under the Fair Work Act, a condition for the union official’s right to request and inspect records relating to your employment or a member of their union is that the record is directly relevant to a suspected contravention of the Fair Work Act, award, enterprise agreement, etc.There’s a 24-hour notice period requirement.

Q. Is there a requirement under the Fair Work Act for staff to complete timesheets?

No, there’s no requirement for staff to complete timesheets. However, employers are obliged to keep certain records, including pay records, records about the type of employment held by an employee and his or her details, leave records and overtime records.

Q. What’s the penalty for a breach or non-compliance?

In the case of a serious breach of the Fair Work Act requirements in respect of employee records a corporate could be liable for up to $25,500 in penalties and an individual $5100.

Further, a breach of the Fair Work Act regulations in respect of record keeping or pay slip requirements may lead to the Fair Work Ombudsman issuing penalties. This can occur within a year of an alleged contravention. The maximum fines for each contravention, which must be paid within 28 days of an infringement notice being issued, are $2550 for a corporation and $510 for an individual.

 Q. What level of ongoing maintenance is required for hard copy documents, electronic storage and so on?

Employee records can’t be altered or allowed to be altered. While this may not necessarily mean that an employer must keep a hard copy of the documents on hand, under current regulations there’s some benefit in keeping the paper record in addition to an electronic record, if that’s the employer’s preferred practice.

Keeping both records will mitigate the possibility of being found to have altered the record where an electronic version is found to be deficient (likewise, keeping an electronic record may help in avoiding losing paper files through flood or fire). To that end, if an employer decides to implement a paper-less record keeping system, the employer should ensure that 100 per cent of the hard copy is recorded from the original and remains readable. Also, preferably archive the originals.

Q. How long do we need to keep our employee records for?

Records that are required to be kept under the Fair Work Act must be kept for seven years.

Q. Can an employee record be inspected?

While an employee record should remain confidential at all times and accessed only by HR managers, employees and former employees or their representatives, such as lawyers or union officials, are entitled to request that the employer provide a copy of their record or some aspect of it. Further, the Fair Work Ombudsman has the power to have its inspectors inspect and copy records.

Q. An employee has requested access to notes the HR manager took when conducting a performance management meeting. Are we obligated to provide them?

No, there’s no obligation to provide them. The employee has no entitlement to them. Of course, they may be discoverable in any court proceeding; however, that’s not a reason to provide them now when no reason has been given. You should refuse, but at the same time indicate a willingness to assist the employee with his/her query if it’s reasonable.

Q. We’re in the process of transferring our business. What are our obligations with regard to our employees’ records?

In a transfer of business situation the previous employer is required to transfer the employment records for each transferring employee upon one of the following occurring:

  • The transfer of business assets;
  • When the work is outsourced or ‘in-sourced’; or
  • For associated entities, when the employee is transferred.

The new employer must ask the old employer to provide them with the employee’s records and the previous employer must provide the records to the new employer

Q. We want to safe-guard against paying allowances and loadings, and we pay higher than award minimums. Can we avoid having to issue individual flexibility agreements with a ‘salary all inclusive’ clause in the employment contracts and do we need to maintain records of this?

You can rely on over-award payments to meet award obligations to pay allowances and loadings in the manner you suggest. You need to be ready to justify the sufficiency of the over-award margin if disputed, with reference to proper time and wages records. Plus you need to be ready to prove compliance with the award if necessary, and you can only do this if you keep sufficient employee records.

If you’re grappling with an HR issue, AHRI:ASSIST is an HR guidance and support centre, with information sheets, checklists, guidelines, templates and much more. 

To find out more about AHRI membership so you can access the full AHRI:ASSIST resource centre, visit the AHRI website.

Leave a reply

avatar
500
  Subscribe to receive comments  
Notify me of
More on HRM