According to a new industry report, Over a quarter of Australian workers are due to a sum of $5 billion in overdue super. Resulting in renewed calls for stricter regulation. One-third of them were the age of 30, with those in low-wage positions suffering the most.
Following the release of a new report, the Morrison government is under pressure to adopt tighter regulatory safeguards to ensure companies pay the Super Guarantee. The $5 billion in unpaid super raises Australia’s overall super debt to an “eye-watering” $28.8 billion, a figure that ISA chief executive Bernie Dean anticipates would only grow in the absence of meaningful policy action. Dean believes that By not legislating the payment of super wages, politicians are preventing millions of people from receiving what they are owed. Dean agreed, saying that if federal politicians receive their super paid with their pay, so should the rest of Australia’s workforce.
The ISA analysis was included in a new paper, which outlined four major legislative recommendations that the Morrison administration should implement to combat super theft.
Among these was a requirement that firms pay their employees’ superannuation on payday. Employers are currently only required to pay their employees’ Super Guarantee once every three months.
Natasha Panagis, head of superannuation at Tax & Super Australia says that the government’s main disincentive is a late payment penalty, which in many situations is insufficient to remedy the problem.
She added that a lack of oversight frequently exacerbates the problem, allowing businesses to go for extended periods without being reprimanded at all, unless the employees of one business band together and report their super underpayments to the ATO. Panagis believes that, like the ISA, enforcing super payments on payday will go a long way toward reducing super underpayments in Australia, assuming that some businesses are unaware they are violating the law.
Another recommendation in the study was for the ATO to go to further measures to crack down on underpaid super. According to the report’s modeling, the ATO recovers only a “dismal” 12 percent of underpaid super each year. The rate of super underpayment was notably high in the 2018-19 fiscal year. According to ISA, about 1.7 million men and 1.3 million women were victims of super underpayments, costing $3.4 billion and $1.6 billion, respectively.
ACTU assistant secretary Scott Connolly backed the report’s suggestions, saying they could provide some protection to the country’s most vulnerable workers, who are also feeling the brunt of an increasingly casualized workforce. She adds that insecure workers are among those who are most exploited by their bosses.
The Morrison Government must prevent employers from Uberising our workforce. By including superannuation in the National Employment Standards, workers and their union representatives must be empowered to retrieve stolen super. In addition, if a company goes bankrupt, employees cannot claim their lost superannuation. Workers should not be forced to pay for their employer’s mistakes; this must change!