Unpaid Super – the issue is bigger than you think

Almost a third of Australian workers are being shortchanged on their super, a joint study by Industry Super Australia and Cbus report has claimed.

The sheer scale of unpaid super is affecting thousands of a comfortable retirement and has prompted the Federal Government to investigate.

Employers must contribute at least 9.5 per cent to the superannuation accounts of every worker earning more than $450 a month. The SuperGuarantee, which applies to full-time, part-time and some casual employees, stipulates that super should be paid at least every three months.

Contributions must be paid into a fund either nominated by the employee or the employer’s default super fund within 28 days of the end of each quarter.

Non-compliance with the Super Guarantee has long been a problem for the ATO, which has the power to penalise Directors for late or non-payment.

In 2015-16, the Australian Taxation Office (ATO) clawed back $241 million in unpaid super, interest and administration fees from employers who tried to avoid their Super Guarantee responsibilities.

Now the Federal Government is looking to step up its fight against unpaid super.

In January, the Senate’s economics reference committee examined the scale and size of Super Guarantee underpayment. The Association of Superannuation Funds of Australia (ASFA) has also called on the government to inject an extra $10 million in annual funding for the ATO to crack down on businesses not paying super contributions.

Regular super contributions are key to building a retirement nest egg. Yet an estimated 2.4 million Australian workers are being cheated of their super entitlements, according to a report by Industry Super Australia. The average affected worker was owed $1,489, or almost 4 months of super contributions, the report revealed.

Yet some workers may not be aware their hard-earned super is missing. They may not have the time to thoroughly check their payslips or view their statements.

These people may regret not taking the time to investigate as their retirement date draws nearer because when it comes to super, every dollar counts.

Members are urged to check their super accounts and with today’s technology, it couldn’t be easier. First Super members can login to their firstonline account to view latest transactions, check employer details and update any personal information.

Australians who work hard to secure themselves a happy and healthy future deserve exactly that. If they suspect their employer isn’t paying super entitlements, they need to take action.

If they are unsure what payments have been made and what obligations their employer may have, they should contact their super fund.

The ATO recommends workers raise any concerns with their employer first and if there is still no resolution to lodge an enquiry with the ATO for investigation.

First Super commissioned The New Daily to research and write this article. The views expressed are of The New Daily.

This article was issued by First Super Pty Ltd (ABN 42 053 498 472, AFSL 223988), as Trustee of the First Super superannuation fund (ABN 56 286 625 181). It does not consider your personal circumstances and may not be relied on as financial advice. Content was accurate at the date of issue, but may subsequently change.