January 14, 2020
If only paying your employees was as simple as writing cheques or sending electronic payments. While the “payment” part could be that simple, the pay slip that goes with an employee’s payday is more complicated.
The Fair Work Regulations requires these documents to contain very specific information. Paying employees is one thing, but providing prompt pay records with the correct information is a separate issue that companies must address.
Do you know what goes into the perfect pay slip? Keep reading to learn more.
Your company’s pay slips are the personalised documents that accompany each employee’s payment within one working day of making payment. This document notes an employee’s wages over the pay period. The document can also include itemised deductions and contributions.
With each slip, an employee understands, amongst other things, that their gross pay amount and the amount deducted from the total payment. The slip also shows an employee’s final net amount, or their “take-home” pay for the current pay period.
No matter what template you use to generate pay notices, be sure your template includes all of the required information.
Make sure you file each slip for each employee. Electronic templates make it easy to keep accurate records without taking up space in file boxes or cabinets. Be sure to keep these records for a minimum of seven years as per the legislation. Missing information can lead to fines.
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A template helps you include all of the required information on each employee’s slip. The Fair Work Regulations are very clear, and all employers must provide this information for each pay period to each employee.
Required information includes:
Using pay slips to provide a combined location where employees can check their current pay, YTD income, and their amount of leave is an excellent benefit for employees. It’s also an efficient way to keep your records up to date.
The Fair Work Regulations are very clear about when you must deliver a pay slip to each employee. Whether electronically or in print, employers must send these documents within one day of the pay date.
Any delay in delivering slips for a pay period can result in a fine.
Yes. The Fair Work Act outlines the obligation of employers to provide pay slips to all employees. Employers who fail to deliver them on time for each pay period can face penalties and fines.
Pay slips ensure that employees receive the correct wages and entitlements per pay period. Each employee’s pay record also confirms legal deductions from each pay period.
A pay slip also helps employees apply for a home or other type of loan. The documents serve as proof of employment and income verification for loan applications or housing rental applications.
Yes. Employers must deliver pay documents to an employee’s private electronic account or in a sealed envelope. Pay slips contain an employee’s confidential pay rate, details about their entitlements and may also contain their current leave balances. Since the slips also contain private information, including banking information, employers must deliver them securely.
Employers must keep time and wage records for seven years to stay compliant with the legislation. All records must be in English, readily available to a Fair Work Inspector (FWI), and easy to read and understand.
Yes, however, most businesses prefer electronic or printed documents. If an employee uses a pay slip when applying for a loan, many banks and lenders don’t accept handwritten pay records.
Whether handwritten or done electronically using a template, pay slips must be legible. Employees and Fair Work Inspectors must be able to read each slip without issue.
Yes. Sending pay slips electronically is an excellent way to deliver these documents to employees. Be sure you send pay slips to an individual email account for each employee. Do not post a link to access electronic slips publicly or on a server with unsecured access.
While it’s not required, including an employee’s accrued sick leave is helpful for employees. It is important to note that employee’s being able to view their accrued balance sometimes leads to employee’s using their sick leave entitlement when it is not genuine. However, it’s convenient to have year-to-date income, deductions, and accrued leave in one central document for both employees and employers.
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