Why you should keep personnel files
There are a lot of details to keep track of for each of your employees. Up-to-date, accurate, detailed records will:
- support the good faith relationship
- help you to correctly calculate employees' pay and leave entitlements
- help with performance management, if you detail issues and performance highlights
- let you keep track of all the little details, instead of having to work it all out when an employee leaves the company or asks for leave
- help you comply with the law.
Legally, you must keep personnel files for at least six years and pay records seven years. You must make them available to:
- your employees, if they ask to see their own file
- their union or other representative, if your employee requests them
- labour inspectors and immigration officers from the Ministry of Business, Innovation and Employment (MBIE), if they request them.
You can keep the records electronically or on paper (but back them up if they’re electronic). The records should be in English.
As an employer, you have flexibility over what form records take, but they must be:
- in an easily accessible form
- able to be printed.
Make sure you keep them secure and don't disclose an employee’s information to another employee without a good and lawful business reason – for example, you can share wage information with the person who pays the wages.
New laws also mean it’s your responsibility to keep records in enough detail to comply with minimum employment entitlements. You must also have a record of the following information for each employee:
- the number of hours worked every day in a pay period
- pay for those hours.
What to include in your personnel files
You need to keep the following mandatory information:
- employee name, postal address and age (if under 20 years old)
- a signed employment agreement covering specific information (and any accompanying role description) and any variations
- type of employment agreement – collective or individual
- offer letter, if there’s no signed employment agreement yet
visa showing eligibility to work in New Zealand, if relevant - an employee-completed tax code declaration (IR330)
- details of agreed wage payment method – for example by cash or a bank account. Legally, all wages must be paid in New Zealand cash unless agreed otherwise in writing – for example in the employment agreement
- employment start date
- annual leave and holidays entitlement anniversary dates – the annual leave anniversary date can differ from the anniversary of the start date due to closedown periods.
Optional information to keep includes:
- offer letter
- emergency contact details
- contact details
- application form or CV.
Mandatory information about time worked
Mandatory information you need to keep about time worked, wages paid, and annual leave taken and owed, includes the following:
- the number of hours worked each day in a pay period and the pay for those hours days worked
- hours worked on those days, including public holidays
- hours worked in different roles (only mandatory if employee performs different roles for different remuneration)
- wages paid in each pay period and method of calculation
dates and payment for holiday, sick or bereavement leave taken - payment (including date of payment), and portion and value of annual leave cashed-up in each entitlement year
- current entitlement to annual leave and sick leave
- dates and payment for public holidays worked and not worked, if they were paid for that day
- dates of alternative holidays taken or to be taken, and payment for any alternative holidays paid out
- day or part of a public holiday agreed to be transferred, including relevant dates (only mandatory if applicable).
Common mistakes
Record-keeping is one of the most common things that employers get wrong. Avoid these common mistakes:
- Not updating records often enough – you must record details on a daily basis.
- Not keeping employment files for long enough – you must keep details for at least six years from the date that the detail is about.
- Not keeping copies of individual employment agreements – your employees can request a copy of this at any time. If you happen to misplace an individual employment agreement you have seven working days to produce or provide a copy of the agreement.
- Only starting to keep records when there's an issue, for example someone has been overpaid.
- Not having enough information to be able to accurately calculate pay for leave.
- Not having enough information in your records to work out what an employee is owed when they leave your business.
- Not having a clear description of a role to help with performance management.
outsourcing payroll but supplying inaccurate records or not enough detail.
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