Contents
What is a Wages and Time Record?
Why do I need a Wages and Time Record as an employer?
Common Mistakes to Avoid for Your Wages and Time Record
Wages and Time Record for Salaried Employees
How to keep a Good Wages and Time Record
When you’re running a business, making sure payroll runs smoothly is a big part of the job. One essential payroll task that often gets overlooked is keeping a compliant wages and time record. It might not be the most exciting task on your list, but it’s one of the most important. In this blog, we’ll break down why wages and time records matter, what you need to include, common mistakes to avoid, and how using a payroll system can make the whole process a lot easier.
What is a Wages and Time Record?
A “Wages and Time” record is a legally required detailed record under the Employment Relations Act 2000 of an employee’s hours worked, how they were paid, and any leave taken.
Here’s what must be included in a wages and time record:
- Employee details: name, postal address, age (if under 20), and the type of employment agreement.
- Wage rate or salary: hourly rate or salary amount, and any changes to it.
- Hours worked: for hourly employees, the actual hours worked each day and the pay period.
- Wages paid: gross and net pay, including any deductions (e.g. PAYE, KiwiSaver).
- Leave entitlements and payments: records of sick leave, annual holidays, public holidays, bereavement leave, and how these were paid and calculated.
- Dates of employment and termination (if applicable).
Why do I need a Wages and Time Record as an employer?
- It’s a legal obligation. You must keep wages and time records for at least 6 years and these records must be readily accessible and in English.
- They help ensure compliance with employment law, especially around leave and minimum wage.
- If a dispute arises, these records are the first thing MBIE inspectors will ask for.
Common Mistakes to Avoid for Your Wages and Time Record
Maintaining a compliant wages and time record is a legal requirement but it’s easy to get it wrong if you’re not careful. Here are some common mistakes we have seen employers make when it comes to keeping a compliant record:
Incomplete Records
A frequent mistake is failing to record the actual hours worked each day, especially for employees on variable hours. Some employers only note weekly totals or pay period summaries, but this doesn’t meet legal requirements under the Employment Relations Act. Daily records are essential and help protect both the employer and employee in case of disputes or audits.
Not Specifying Leave Types
Simply writing “leave” in your records isn’t enough to stay compliant. You must clearly identify the type of leave taken (e.g. annual leave, sick leave), the dates, and the pay rate applied. If a Labour Inspector asks to verify that holiday leave has been paid correctly, this level of detail is required.
No Written Agreement or Statement
For salaried employees with fixed hours, daily records may not be necessary but that doesn’t mean you don’t need documentation. A written employment agreement or statement must clearly outline the employee’s usual hours and pay. This document is part of your obligation and should be available on request.
Relying Solely on Rosters
Rosters are useful for planning but not valid proof of hours actually worked. An employee rostered for a shift may have called in sick and the roster wouldn’t reflect that. A properly maintained wages and time record is responsible for showing that information. That’s why relying only on rosters puts you at risk of non-compliance.
Wages and Time Record for Salaried Employees
There’s often confusion around how to handle wages and time records for salaried employees. According to Employment New Zealand:
“If you and your employee have agreed on certain hours and pay, then a statement of those usual hours and pay will be enough.”
But what exactly counts as that statement and what nuances should employers be aware of in order to stay compliant?
Do I need to record daily hours for salaried employees?
If your salaried employees work fixed hours (e.g. Monday to Friday, 9am–5pm), you don’t need to record hours worked each day as long as:
- Their hours are agreed upon in writing, and
- Their hours and pay don’t vary.
In this case, you can include a clear statement of their usual hours in:
- the wages and time record,
- the employment agreement, or
- a roster or schedule used in the normal course of employment.
This meets the legal requirement, so long as the employee is consistently working their agreed hours and receiving the correct pay.
What if salaried employees work extra hours or irregular schedules?
Even if salaried employees aren’t paid overtime, you still need to record any additional hours they work if:
- Their hours vary from what’s agreed,
- They work public holidays, irregular shifts, or on-call hours, or
- Their effective hourly rate might fall below the minimum wage when extra hours are factored in.
Recording these additional hours helps you stay compliant and protects both the employer and employee in case of disputes.
It’s best practice to note any extra hours worked, even if unpaid or there is a statement of usual hours, to protect both the employer and employee in case of disputes.
How to keep a Good Wages and Time Record
Employment New Zealand provides a template for a wages and time record which includes the required information you would need to fill out in order to keep a compliant wages and time record.
However, manually filling this out for every employee for every day worked can quickly become a tedious and time-consuming admin task. Using a payroll system can meet all the requirements of keeping a wages and time record while greatly reducing admin load.
If you use a payroll system, the wages and time record is the digital record automatically generated and stored by your payroll software. It should contain all the legally required information, which includes:
- Employee details (name, age if under 20, agreement type)
- Wage/salary and rate of pay
- Daily or regular hours worked (especially for hourly or variable workers)
- Gross and net pay
- Deductions (e.g. PAYE, student loans, KiwiSaver)
- Leave entitlements and payments
- Start and (if applicable) end date of employment
Although a payroll system won’t present all the information on a single sheet like the Employment New Zealand template, it is considered a compliant wages and time record as long as all the legally required details are captured. What matters is that the information is recorded, retained for at least six years, and can be retrieved in a clear report format if requested by an employee or during an audit.
A payroll system like Crystal Payroll stores this data and can produce it in report form, either as a downloadable PDF or spreadsheet, which meets the legal requirement under the Employment Relations Act 2000 and Holidays Act 2003.
How Crystal Payroll Makes Wages and Time Records Simple
At Crystal Payroll, we know that accuracy and compliance matter, but so does saving time. That’s why we’ve built an extensive suite of reports that cover all the requirements of a wages and time record, while keeping everything clear, easy, and quick to access.
- Automatic recordkeeping – Every time you run payroll, Crystal Payroll automatically records employees’ daily hours and pay. This means you’re always covered if employees request this information, or if you’re ever audited.
- Flexible reporting – While the law prefers day-by-day records, we also support summarised period totals for employers who want a quick overview of worked hours.
- Detailed analysis – Our Earnings and Hours Analysis report (shown below) breaks down both daily income and hours worked, side by side. This serves as a complete, compliant record of daily hours worked.
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- Leave clarity – With our Leave Analysis reports, you can also see details on leave entitlements and usage, ensuring nothing is overlooked.
Crystal Payroll not only keeps you compliant under the Employment Relations Act 2000 and the Holidays Act 2003, but also removes the hassle of manual recordkeeping. Your records are always accurate, always up to date, and always just a click away.
Conclusion
By keeping clear, accurate records, you not only meet your legal obligations but also protect your business in the event of disputes or audits.
Manually maintaining these records can be time-consuming, but with Crystal Payroll, compliance becomes effortless. Our reporting tools ensure every required detail is captured, stored securely, and available at the click of a button. That means less admin, more accuracy, and complete peace of mind that your business is meeting its obligations under New Zealand law.
If you’d like to learn more about Crystal Payroll, get in touch with our team to see how we can support you not just with accurate report keeping, but with streamlining your entire payroll process.
Disclaimer: This blog post is intended for informational purposes and should not be considered as financial or legal advice. Always consult with professionals for tailored guidance.
