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Fair Work Compliant Record Keeping
Running a business is busy enough without the added stress of complex compliance rules. But one area that can’t be ignored is record-keeping. Under the Fair Work Act 2009 (Cth), all employers in Australia are legally required to keep accurate employment records — and failing to do so can result in significant fines, back-pay claims, and reputational damage.
While it may sound administrative, record-keeping is one of the simplest yet most powerful compliance tools available to employers. It protects your business, supports transparency, and builds trust with your team.
Why Record-Keeping Matters
Good record-keeping is about more than ticking a compliance box — it’s about protecting both your business and your employees.
Accurate, up-to-date records help you:
- Prove compliance – Demonstrate that you’re meeting obligations under the Fair Work Act, Awards, and Superannuation laws.
- Defend disputes – If an underpayment or dismissal claim arises, detailed records are often your best (and sometimes only) defence.
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Provide clarity – When employees understand how and why pay or leave is calculated, trust increases and conflict decreases.
In short, good records don’t just protect against penalties — they help maintain fairness, consistency, and confidence across your workplace.
What Records Employers Must Keep
Employers must keep employee records for at least seven years, and they must be:
- In English
- Legible and readily accessible
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Accurate, not altered unless to correct an error
These records should cover all aspects of the employment relationship, including:
1. Employment Details
- Employee’s full name and start date
- Employment type (full-time, part-time, or casual)
- Any agreed classification or award level
2. Pay Records
- Gross and net amounts paid
- Pay period dates
- Deductions, loadings, allowances, bonuses, and penalty rates
3. Hours of Work
- Actual hours worked for casual employees and those under awards/agreements
- Overtime details (where applicable)
4. Leave Records
- Type and amount of leave taken (annual, personal, carers, parental, etc.)
- Leave balances
5. Superannuation
- Amount of contributions made
- Date paid and fund details
- Any employee-nominated fund forms
6. Agreements and Flexibility Arrangements
- Copies of Individual Flexibility Agreements
- Guarantees of annual earnings or any contractual variations
7. Termination Records
- Date and method of termination
- Notice provided
- Redundancy details if applicable
Payslips – A Legal Must
Payslips are one of the most visible forms of compliance. They must be issued to employees within one working day of payday, even if they are on leave.
Each payslip must include:
- Employer and employee name
- Pay period and date of payment
- Gross and net pay
- Ordinary hourly rate and hours worked (for hourly employees)
- Loadings, allowances, bonuses, and deductions
- Superannuation contributions and fund name
Payslips can be electronic or printed, but they must be easily accessible and accurately reflect the pay details for that period.
Failing to provide proper payslips is a red flag for the Fair Work Ombudsman and often triggers closer investigation into broader compliance issues.
What Happens If You Don’t Comply
Failing to keep proper records or issue compliant payslips can expose your business to serious consequences:
- Financial penalties – The Fair Work Ombudsman can issue infringement notices or take court action, with fines exceeding $60,000 per breach for companies in serious cases.
- Underpayment risk – Without accurate records, it’s almost impossible to defend an employee’s claim for unpaid wages or entitlements.
- Reputational harm – Breaches are public and can impact your brand, recruitment, and employee trust.
Record-keeping issues are one of the most common compliance failures identified during Fair Work audits, but also one of the easiest to fix.
Simple Steps to Stay Compliant
Building good record-keeping habits doesn’t have to be complicated.
- Use reliable payroll software – Choose systems that automatically record hours, pay, and super, and generate compliant payslips.
- Store records securely – Keep digital or hard copies safely for seven years, with backups.
- Audit regularly – Schedule internal reviews to check pay rates, leave balances, and super payments align with legal requirements.
- Train your leaders – Managers should understand what needs to be recorded, how to approve timesheets, and why accuracy matters.
- Document everything – When in doubt, record it. Notes on meetings, approvals, and agreements can make a major difference if issues arise later.
Final Thoughts
At Jessie Grace, we often say that good record-keeping is good risk management. It’s not just about compliance, it’s about creating clarity and confidence in your business.
When records are complete, accessible, and up to date, leaders can make better decisions, employees feel more secure, and your business is protected against costly mistakes.
If you’re unsure whether your systems meet Fair Work requirements, it’s worth conducting a simple compliance audit. A few proactive steps today can save significant time, money, and stress down the line.
How long do I need to keep employee records?
You must keep all employment-related records for at least seven years after they are made. This includes pay, hours, leave, and termination records. Even if an employee leaves, their file must be retained for that full period in case of future audits or claims.
Can I keep records electronically, or do they need to be paper copies?
Electronic records are perfectly acceptable, provided they are readily accessible, secure, and printable on request. Many employers now use cloud-based payroll and HR systems to store records digitally. Just ensure they can produce complete, legible copies in English if Fair Work requests them.
Who can access employee records?
Employee records are confidential. They can be accessed by the employee (or their authorised representative), the Fair Work Ombudsman, or other regulators if required by law. They should never be shared with third parties without consent or a lawful reason.
What should I do if I find errors in my records or payslips?
Correct the error as soon as possible and re-issue updated payslips or records with a clear note identifying the correction. Keep both the original and corrected versions for transparency. If the error caused an underpayment, fix it promptly and document the steps taken.
Are contractors and labour hire workers covered by these record-keeping rules?
The Fair Work Act applies to employees, not genuine independent contractors. However, misclassification risks are high. Always keep written agreements, invoices, and ABN details for contractors, and verify that their arrangements are truly independent to avoid penalties for sham contracting.
It is advised to track contractor records the same as employees so that you have a defensible position if the relationship is challenged in the future.
How often should I review or audit my records?
A quick internal audit every 6–12 months is best practice. Check pay rates against Awards, ensure superannuation and leave balances are accurate, and confirm all records are complete and accessible. Regular checks make compliance easy and prevent small errors from becoming costly disputes.