Running a business usually means that you’re flat-out, with endless tasks which need to be done. It’s important that one of those tasks is ensuring you keep proper employment records as prescribed by the Fair Work Act 2009 (Cth). While this may seem like a low priority at times, the reality is that an ‘underpayment claim’ is one of those things that can quickly overwhelm your business.
You must keep your employment records for seven years and ensure they include the following things:
- Employment details – the name of the employer and the employee and the nature of their employment (part-time, full-time, permanent, temporary, or casual).
- Pay – a record of the hours worked and the rates of pay for those hours. It is important to ensure that time sheets and rates of pay are kept for casual, part-time and most annualised salaried employees.
- Overtime worked – a record must be kept of the number of overtime hours worked by an employee each day, as well as the start and finish times of those overtime hours.
- Averaging of hours – if you and your employee agree in writing to an averaging of their hours of work, a copy of this written agreement must be kept.
- Leave entitlements – any sick, annual or long service leave that an employee takes must be kept and the balance of the employees’ entitlement must be accurately recorded.
- Superannuation contributions – amount, period over which the contribution were made, date of contribution, superfund name and basis for which the employer made the payment.
- Termination of employment – a record must be kept as to whether the employment was terminated by consent, notice, summarily or in some other manner, as well as the name of the person who acted to terminate the employment.
- Individual Flexibility Arrangements and guarantees of annual earnings – a written copy of the arrangement and guarantee must be made and kept.
What should you do?
You must have proper time recording facilities for each employee. Each employee must sign in and sign out, and failure to do so should result in disciplinary action.
Why is all this necessary?
All Modern Awards have set hours and overtime provisions. If you have employees who work outside of these set hours then they have a right to overtime. The onus is on you, as the employer, to ensure that sufficient records are kept to show that no overtime was worked. If you don’t have these records, then your employees are likely to be successful in asserting they have been underpaid. These underpayment claims can range from a few hundred dollars, to tens of thousands of dollars.
Having accurate ‘sign-in and sign-out’ records is the best protection you can have against a claim for underpayment of overtime and penalty rates. You should also have a clear policy on when an employee can and cannot work overtime, including what process they need to follow to have any proposed overtime approved.
How we can help
Speak to JFMLAW to get our cost-effective bundle of workplace documents which includes a ‘sign-in and sign-out’ policy and a ‘no overtime unless approved in writing’ policy.
We also offer an innovative service to employers who want to have a monthly catch up on any workplace matters for as little as $250 per month with no fixed contract. Speak to John Morrissey on 0407 069 507 or Thomas Du on 0410 906 194 about how to save money on all employment matters and disputes.
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