Unpaid super could block insurance
Reports that almost one-third of Australian workers were missing out on superannuation guarantee (SG) payments due to employers avoiding making compulsory payments could have adverse effects on their ability to access insurance benefits through their super.
Such was the warning from Maurice Blackburn Lawyers, which referred to a joint report from Industry Super Australia and Cbus that analysed data from the Australian Taxation Office (ATO) and the Australian Bureau of Statistics (ABS) and found employers were dodging payments amounting to $3.6 billion.
The law firm's principal, Peter Koutsoukis, said there were many examples where people's right to make a total and permanent disability (TPD) claim through superannuation had been affected because their employer had failed to make the correct super contributions on behalf of their employees.
"Sadly this is a scenario we see too often, where someone believes they have TPD insurance through their super, only to find out when it's too late that their employer has not been paying the proper contributions, sometimes for a number of years," Koutsoukis said.
"This leaves people at a major disadvantage in seeking to access insurance they are entitled to, when they are already in a stressful situation dealing with a significant injury or illness."
Koutsoukis called on the Government to adequately resource the ATO to aid in recovering unpaid super, as well as support recommendations that appropriate systems were in place to help super funds play a larger role in recovering missing entitlements.
He also said the law firm supported recommendations for enhanced reporting and compliance on paying contributions and penalising employers who failed to fulfil this obligation.
AUTHOR
Malavika Santhebennur
Recommended for you
Data and technology provider Novigi has acquired Iress’ superannuation consulting and managed services business from Apex Group.
AMP is to launch a digital advice service to provide retirement advice to members of its AMP Super Fund, in partnership with Bravura Solutions.
Unveiling its performance for the calendar year 2024, AMP has noted a “careful” investment in bitcoin futures proved beneficial for its superannuation members.
SuperRatings has shared the median estimated return for balanced superannuation funds for the calendar year 2024, finding the year achieved “strong and consistent positive” returns.
