Employee Records: What to Keep and for How Long
A register of employees, hours worked, leave, pay records and tax records. What the law requires, and how long to keep each one, in one table.
On this page
- The statutory registers, Act by Act
- Retention periods in one table
- Payroll records: what an IRD or EPF audit asks for
- Attendance and leave records
- Contracts, letters and disciplinary files
- Electronic records: are they acceptable?
- Destroying records safely when the period ends
- Frequently asked questions
- Do I need a paper copy of every record, or can everything be digital?
- How far back can the Commissioner of Labour ask for records from a former employer?
- What is the retention period for EPF records?
- How long do I keep payroll records for tax purposes?
- Do I need to keep records for an employee who never completed probation?
You must keep a register of employees, a record of hours and leave, the pay records, and tax records. Most have no single fixed number of years in the Act. Keep them while the person is employed. After they leave, the safe floor, on the sources checked, is at least two years, and five years for tax records from each transaction.
This page is for the employer or the person running payroll. It covers the main Acts that set record duties, and points you to the exact page for pay days, gratuity and data protection.
The statutory registers, Act by Act
The Shop and Office Employees Act guide covers the full Act. Section 18 sets four specific records every shop or office employer must keep on the premises:
- A notice listing everyone employed there.
- A record of hours actually worked, including overtime, holidays and leave taken by each person.
- A notice of the minimum rate of remuneration (the Act’s word for salary or wages, including cost-of-living allowance, overtime pay and prescribed allowances), if one has been set for that job.
- Any other record prescribed by regulation.
Section 17 adds the written terms of employment. Give these to each person on the day they start. The EPF Act adds a separate duty (s.33): every employer must keep records the Commissioner sets out in a Gazette notice. The EPF Act does not name a number of years. Ask the Labour Department for the current notice. The Inland Revenue Act adds a third duty (s.120(1)). A business must keep records that show all its transactions, including payroll.
Retention periods in one table
| Record | How long | Source |
|---|---|---|
| Employee register, hours, leave (s.18) | No fixed period in the Act itself; keep while employed, plus at least 2 years after | Shop and Office Employees Act s.18, s.47(1A) |
| Written terms of employment (s.17) | Same as above | Shop and Office Employees Act s.17, s.47(1A) |
| EPF records (Form C, service record) | Set by the Commissioner in a Gazette notice, not a fixed figure in the Act | EPF Act s.33 |
| ETF records (R1/R4, Form II) | Keep for as long as a member could still claim; no fixed year-count published | ETF employer guide |
| Tax and payroll transaction records (APIT, T10) | 5 years from the transaction date; longer if a tax assessment is still open | Inland Revenue Act s.120(6) |
For the R1/R4 monthly forms and the half-yearly return itself, see ETF R4 Half-Yearly Return: Deadlines and Filing.
The Shop and Office Employees Act sets no end date for keeping the s.18 register. Section 47(1A) sets the one number it does give. The Commissioner of Labour can ask a former employer for up to two years of records, counted back from the date of the request. That sets the practical floor. Keep the record for at least two years after someone leaves, and keep it current while they are still employed.
Payroll records: what an IRD or EPF audit asks for
For tax, the Inland Revenue Act is specific. Keep records for five years from the date of each transaction (s.120(6)), longer if a tax assessment on that period is still open. The Act names the source documents to keep (s.120(10)): invoices, bank statements, contracts and purchase orders. Payroll bank files and payment records fall in the same group.
For EPF, an inspector can enter and examine any register or record of an employee’s earnings, and take copies (s.32). Keep the Form C history and the service record ready — see the EPF employer guide for what to keep. A leaver’s own EPF claim needs your certification of their last contribution.
Attendance and leave records
Section 18(b) requires a record of hours actually worked, with overtime, holidays and leave shown for each person. This is the record a pay or leave dispute turns on. For what these records can tell you month to month, see how employee reports help track tenure, performance and payroll history.
Contracts, letters and disciplinary files
The Act does not set a fixed retention period for appointment letters, warning letters or disciplinary files. This is good practice, not a stated legal duty on the sources checked. Keep them for as long as the employment lasts. Keep them longer if a claim could still be brought.
Electronic records: are they acceptable?
The sources checked do not say. The Act asks the employer to “maintain” each record “in the prescribed form and manner”. It does not name paper specifically. The regulation setting the exact form was not checked for this article. If you keep records digitally, keep them backed up and ready to produce if the Commissioner of Labour asks for them. Data protection rules may add duties on top of this. See PDPA and HR records: what Sri Lankan employers owe for what applies.
Destroying records safely when the period ends
No source checked sets a destroy-by date. Before removing any record, check:
- Is a tax assessment on that period still open?
- Could an EPF or ETF claim still be made for that employee?
- Could a dispute still be raised about that period?
Keep the record if any answer is yes. Ask the Labour Department or a tax adviser if you are not sure.
Do this automatically in Humanised. An employee management system keeps the register, the contracts and the pay records in one searchable place, attached to the employee’s record from day one.
This is general payroll guidance. Every case is different. For your own case, speak to a payroll practitioner or a lawyer.
Frequently asked questions
Do I need a paper copy of every record, or can everything be digital?
The sources checked do not say. The Act requires the record to be maintained “in the prescribed form and manner”; it does not name paper specifically. Keep backups if you go digital, since the record must still be producible if the Commissioner of Labour asks for it.
How far back can the Commissioner of Labour ask for records from a former employer?
Up to two years before the date of the request (s.47(1A)). This is the clearest statutory number in the Shop and Office Employees Act for record retrieval.
What is the retention period for EPF records?
The Act leaves this to the Commissioner of Labour, set by a Gazette notice, rather than fixing a number of years itself. Ask the Labour Department for the current notice if you need an exact figure.
How long do I keep payroll records for tax purposes?
Five years from the date of the transaction, or longer if a tax assessment for that period is still open (Inland Revenue Act s.120(6)).
Do I need to keep records for an employee who never completed probation?
Yes. The record duties in section 18 apply to anyone employed in or about the business, for however long they were on the payroll.
Was this article helpful?
Your feedback helps us improve these guides.