Push for super to be paid each payday
Industry Super Australia (ISA), the umbrella group representing not-for-profit industry super funds, is calling on the Federal government to change the law, so that employers would be required to pay super entitlements of their employees at the same time they receive their salary or wages.
The Australian Tax Office (ATO) is now doing more to chase employers not paying the compulsory superannuation guarantee to their employers, ISA says, but the problem of non-payment of super still affects a third of the workforce.
Employers are legally required to pay 9.5 per cent in super to each employee, including part time and casual employees, over the age of 18 earning more than $450 gross a month.
ISA chief executive Bernie Dean says a third of the Australian workforce – about 2.8 million people – are losing close to $6 billion a year in unpaid super.
Super is currently only required to be paid into a worker’s retirement savings account quarterly. That means it is easy for payments to fall through the cracks or for unscrupulous employers to deliberately retain the money, says ISA.
Workers may believe their super has been paid into their fund more regularly because the payments often appear on their payslip, but there is no legal requirement for it to be paid into their super account at the same time as their salary is paid.
Part of the reason for the extent of the problem is that it has been largely up to employees to raise the issue with their employers, or to raise it with the ATO. Understandably, many workers, particularly those working casually, are reluctant to take-up the matter themselves.