Employee Payroll Records: What to Keep and Why

Employee Payroll Records: Complete Guide

Every employer is required by federal and state law to maintain certain payroll records for each employee. This guide covers what to keep and why.

Required Employee Payroll Information

Personal Information

• Full legal name
• Social Security Number
• Address
• Date of birth
• Gender (for statistical purposes)

Employment Information

• Hire date
• Job title and department
• Employment status (full-time, part-time)
• Exempt vs. non-exempt classification
• Pay rate and pay basis

Pay Period Records

• Hours worked each day and week
• Straight-time earnings
• Overtime earnings
• Additions to or deductions from wages
• Total wages paid each pay period
• Date of payment and pay period covered

Tax Information

• W-4 form data
• Federal and state tax withholdings
• FICA contributions
• Other tax-related deductions

FLSA Record-Keeping Requirements

The Fair Labor Standards Act requires employers to keep:

• Basic employee information
• Day and time when workweek begins
• Regular hourly rate for any week with overtime
• Total daily or weekly straight-time earnings
• Total overtime compensation for the workweek
• Total additions to or deductions from wages
• Total wages paid each pay period
• Date of payment and pay period covered

Best Practices

1. Use a consistent system for all employees
2. Update records promptly with any changes
3. Store records securely with limited access
4. Back up digital records regularly
5. Train payroll staff on compliance requirements
6. Conduct annual record audits