Paymaster Magazine

Keeping Employee Records

Retention of Employee Records

Employers should familiarise themselves with those employee records that must be retained if they are not to incur severe penalties. These records can be maintained electronically and copies of documents scanned and kept online (Paymaster can do that for you)

Employment legislation specifies:

• The records an employer is obliged to retain;
• The period for which the employer is expected to retain such records; and
• The penalties to be imposed on employers failing to comply with such legislation.

The Basic Conditions of Employment Act (BCEA) lists the relevant particulars, which particulars are tantamount to a contract of employment.

The employer is legally obliged to retain particulars of:

• The employee’s job description;
• The date on which employment commenced;
• The hours of work;
• Remuneration particulars;
• Leave provisions; and
• Notice period.

The employer has to retain such data for three years after termination of employment. (NB SARS require you to keep all records for a period of 5 years)

This statutory provision does not apply to employees who work less than 24 hours a month for that employer.

The BCEA’s requirements aside, it is advisable to cater for other particulars, among them the benefits to which the employee is entitled, copyright and patents, and restraint of trade agreements. The employer should retain the records in question for three years after termination of employment.

The BCEA provides that the records to be retained must contain the following employee details:

• Name and occupation;
• The time worked;
• The remuneration paid;
• The date of birth of any employee under 18 years of age; and
• A wage and attendance register.

The forms are to be retained for the stipulated three years from the date of the last entry.

This statutory provision does not apply to an employer who employs fewer than five people, or to employees who work less than 24 hours a month for that employer.

Schedule 2 of the BCEA specifies the penalties which may be imposed on an employer for failing to comply with the provisions of the BCEA. The fines range from R100 to R500 per employee.
Labour relations act
The Labour Relations Act (LRA) stipulates that unless a collective agreement, arbitration award or determination made in terms of the BCEA provides otherwise, every employer on whom a collective agreement, arbitration award or determination is binding must retain a copy of that agreement, award or determination.

The LRA also provides that an employer is legally obliged to keep records in compliance with any applicable collective agreement or arbitration award and is obliged to retain such records in their original form or a reproduced form for three years from the date of the event or end of the period to which they relate.

According to the LRA, an employer must keep a record of the prescribed details of any strike, lock-out or protest action involving its employees. LRA regulations contain a prescribed form, which the employer is obliged to complete and submit a copy thereof to the Department of Labour. The employer is also obliged to retain a copy.


The Unemployment Insurance Contributions Act, together with the Income Tax Act, obliges employers to retain records of remuneration paid, tax which has been deducted and unemployment insurance fund contributions and payments for each employee. The records must be maintained in such form, including any electronic form, as may be prescribed by the revenue authorities. These records should be kept for five years from the date of the last entry and must be available for inspection by the South African Revenue Service and Unemployment Insurance Fund officials. An employer who contravenes these statutory provisions will be guilty of an offence and liable on conviction to a fine, to imprisonment for not more than 12 months or both the fine and imprisonment.

Employment Equity
The Employment Equity Act (EEA) places a legal obligation on “designated employers” to retain records of its workforce, its employment equity plan and other records relevant to its compliance with the EEA.

It is advisable to keep records of all interviews conducted with job applicants. In terms of the EEA, a job applicant may challenge a recruitment decision on the basis of unfair discrimination within six months of the recruitment decision – a period for which the employer should retain the relevant records.

Other employee-related legislation includes the Skills Development Act and the Occupational Health and Safety Act, both of which also prescribe those records employers are obliged to retain.

Employers bound by such legislation are urged to familiarise themselves with the provisions of these Acts to avoid penalties.

You could keep all these pieces of paper  in lots and lots of files and archive them in large boxes in large rooms or you could talk to paymaster and investigate keeping all your records on the internet linked to each employee –always available from anywhere at any time.

Adrian Baillie-Stewart

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