Perhaps the most important of employer records, personnel and payroll records are often subject to heightened scrutiny in terms of both legal protection and corresponding enforcement activity by regulatory agencies. Consequently, proper maintenance of these records is of the utmost importance.
FLSA Recordkeeping Requirements
The federal Fair Labor Standards Act (FLSA) sets out detailed requirements for which personnel and payroll records must be kept and for how long.
The FLSA generally applies to private employers that have at least two employees and $500,000 in gross annual revenues. Hospitals, businesses providing medical or nursing care for residents, schools, and government agencies—regardless of their annual gross sales—are also covered.
Note that if an employer’s annual sales are under $500,000, individual employees are covered if they engage in interstate commerce (the buying and selling of products or services across state lines).
The FLSA’s recordkeeping requirements apply primarily to nonexempt employees, defined by the FLSA as those employees protected by its minimum wage and overtime pay regulations. The FLSA requires employers to maintain the following information for nonexempt employees:
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- the employee’s full name, as used for Social Security purposes, and on the same record, the employee’s identifying symbol or number if it is used in place of name on any time, work, or payroll records
- address, including zip code
- birth date, if younger than age 19
- sex and occupation
- time and day of week when the employee’s workweek begins
- hours worked each day and total hours worked each workweek
- basis on which the employee’s wages are paid (per hour or per week)
- regular hourly pay rate
- total daily or weekly straight-time earnings
- total overtime earnings for the workweek
- all additions to or deductions from the employee’s wages
- total wages paid each pay period
- date of payment and the pay period covered by the payment
While the FLSA does not specify the form in which the records must be kept (paper or electronic), it requires the records to be accurate, complete, and maintained by the employer for three years.
Tomorrow, we’ll look at the recordkeeping requirements of the Equal Pay Act (EPA), which is part of the FLSA and expands its scope.
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Don’t forget the California Labor Code has its own payroll recordkeeping requirements, so of which are more extensive than those under the FLSA.
Don’t forget the California Labor Code has its own payroll recordkeeping requirements, so of which are more extensive than those under the FLSA.