Pay SG at same time as wages, says ISA
Despite the recent legislation efforts of the Federal Government employers are still under no obligation to pay the superannuation guarantee (SG) at the time it is disclosed in workers’ pay packets, according to Industry Super Australia (ISA).
The industry funds are calling on the Government to legislate to compel employers to pay the SG at the same time they pay wages.
ISA has conducted a new analysis of Australian Taxation Office (ATO) data which it says suggests the scourge of unpaid super is deteriorating with 2.98 million Australians being short-changed $5.9 billion in super entitlements in 2015-16, up 220,000 employees and $300 million compared to two years earlier.
It said that for the one in three workers eligible for SG affected, the average underpayment stood at $1,994 or the equivalent of $77 per fortnightly pay.
The ISA analysis said that those most at risk of being impacted by rogue employers were younger workers, those in part-time and casual work and those in blue-collar jobs.
It found:
- Workers under the age of 30 are a third more likely to miss out on their legal entitlement compared to older workers;
- Over 45 per cent of labourers, machinery operators and drivers have collectively missed out on more than $820 million making it to their super accounts;
- Part-time and casual workers earning less than $30,000 are a third more likely to miss out on super compared to full-time workers and those on higher salaries.
Commenting on the research, ISA chief executive, Bernie Dean said it was apparent some employers were taking advantage of outdated super laws coupled with lower skilled and new workforce entrants who were less likely to know their entitlements or ask questions.
“It’s obvious that the rise of insecure employment is amplifying the already widespread problem of unpaid super,” he said. “This money should be in workers accounts, not on the ledger of an employer that’s taking advantage of lax laws and a cop-free environment.”
“Despite new laws before the Parliament that should improve reporting of super, employers are still under no obligation to actually pay super contributions at the time they are disclosed on payslips,” Dean said. “The number one policy to fix the rip offs is to require employers to pay super at the same time as wages and salary, rather than allow the money to be used for other things for up to four months.”
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