Retirement
Are you getting all the super you’re entitled to?
Employees are losing $1.5 billion a year in unpaid superannuation due to a government loophole, an industry body has flagged.
Are you getting all the super you’re entitled to?
Employees are losing $1.5 billion a year in unpaid superannuation due to a government loophole, an industry body has flagged.
New research from Industry Super Australia has highlighted that between 2016 and 2017, more than 370,000 workers missed out on more than $1.5 billion in superannuation due to a loophole that allows employers to use an individual’s salary sacrificed contribution to fulfil super guarantee requirements.
The superannuation provider said the government’s amendment to the Treasury Laws Amendment (2019 Tax Integrity and Other Measures No.1) Bill 2019 amends the Superannuation Guarantee (Administration) Act 1992 was a good first step but more is needed.
While the bill was designed to prevent an employer using salary sacrificing as part of the super guarantee, Industry Super has said the new legislation only helps 16.6 per cent of employers.
According to Industry Super Australia chief executive Bernie Dean, more needs to be done to protect workers that try to plan for retirement through salary sacrificing.
“More than 370,000 workers who think they’re doing the right thing and contributing to their own super are actually being double-crossed by their employers because of this loophole,” he explained.
Acknowledging that the issue with salary sacrificing is only “one part of a much bigger problem” facing Australia’s superannuation framework, Mr Dean has claimed that more needs to be done to clean up the industry as a whole.
“One in three workers are not getting paid super because dodgy bosses are hanging on to it and keeping it inside their business. It’s daylight robbery,” the chief executive exclaimed.
One proposition put forward by Industry Super as a potential solution to the problem would be the linking of superannuation with pay cycles to decrease employers’ incentives to underpay the quarterly super guarantee payment when it is due.
“The government needs to go further and stop unpaid super once and for all by making super payable on pay day,” Mr Dean said.
RELATED ARTICLES
About the author
About the author
Superannuation
Rest appoints Marina Pasika as interim head of private markets
Rest, one of Australia's largest profit-to-member superannuation funds, has announced the appointment of Marina Pasika as the Interim Head of Private Markets. This decision comes as the fund embarks ...Read more
Superannuation
Payday Super bill introduces new challenges for SMBs, reveals Employment Hero CEO
The introduction of the Payday Super bill to the Australian Parliament has sparked a significant response from the business community, particularly among small and medium-sized businesses (SMBs)Read more
Superannuation
Rest urges Parliament to expedite payday super legislation
In a significant move towards enhancing retirement outcomes for Australian workers, Rest, one of the country's largest profit-to-member superannuation funds, has expressed strong support for the ...Read more
Superannuation
Recalibrated super performance test aims to enhance accountability and investment opportunities
In a move that signals a shift rather than a cessation, Australia's government has announced a targeted review of the superannuation performance test. This recalibration, prompted by the latest ...Read more
Superannuation
Super performance test faces a fork balancing member value productive investment and regulatory trust
APRA’s latest superannuation performance test results have reignited a high‑stakes debate: does the test optimise member value or unintentionally curb long‑term investment in housing, infrastructure ...Read more
Superannuation
Aware Super unveils innovative digital tool to boost retirees' financial confidence
Aware Super has unveiled a groundbreaking digital advice tool, Retirement Manager, designed to empower retirees by addressing their most pressing financial concerns. Developed in collaboration with ...Read more
Superannuation
APRA's super shake-up: Balancing accountability and innovation in the next round
Australia’s performance test has forced long-overdue transparency in super and accelerated consolidation. But as the regime broadens, its blunt edges are colliding with investment complexity, ESG ...Read more
Superannuation
APRA’s performance test is doing its job — but now it risks doing the wrong job well
Australia’s superannuation performance test has flushed out chronic underperformance and catalysed consolidation. But its latest results have reignited a bigger question: can a single, ...Read more
Superannuation
Rest appoints Marina Pasika as interim head of private markets
Rest, one of Australia's largest profit-to-member superannuation funds, has announced the appointment of Marina Pasika as the Interim Head of Private Markets. This decision comes as the fund embarks ...Read more
Superannuation
Payday Super bill introduces new challenges for SMBs, reveals Employment Hero CEO
The introduction of the Payday Super bill to the Australian Parliament has sparked a significant response from the business community, particularly among small and medium-sized businesses (SMBs)Read more
Superannuation
Rest urges Parliament to expedite payday super legislation
In a significant move towards enhancing retirement outcomes for Australian workers, Rest, one of the country's largest profit-to-member superannuation funds, has expressed strong support for the ...Read more
Superannuation
Recalibrated super performance test aims to enhance accountability and investment opportunities
In a move that signals a shift rather than a cessation, Australia's government has announced a targeted review of the superannuation performance test. This recalibration, prompted by the latest ...Read more
Superannuation
Super performance test faces a fork balancing member value productive investment and regulatory trust
APRA’s latest superannuation performance test results have reignited a high‑stakes debate: does the test optimise member value or unintentionally curb long‑term investment in housing, infrastructure ...Read more
Superannuation
Aware Super unveils innovative digital tool to boost retirees' financial confidence
Aware Super has unveiled a groundbreaking digital advice tool, Retirement Manager, designed to empower retirees by addressing their most pressing financial concerns. Developed in collaboration with ...Read more
Superannuation
APRA's super shake-up: Balancing accountability and innovation in the next round
Australia’s performance test has forced long-overdue transparency in super and accelerated consolidation. But as the regime broadens, its blunt edges are colliding with investment complexity, ESG ...Read more
Superannuation
APRA’s performance test is doing its job — but now it risks doing the wrong job well
Australia’s superannuation performance test has flushed out chronic underperformance and catalysed consolidation. But its latest results have reignited a bigger question: can a single, ...Read more
