Industry Super Australia (ISA) is urging the government to improve proposed laws addressing unpaid superannuation.
ISA Public Affairs Director Matt Linden says about three million workers were short-changed compulsory super entitlements in 2015-16 at an average of $1995 each – amounting to $5.9 billion.
“This is an issue for people denied their retirement savings; it’s an issue for government through increased pension costs; and it’s an issue for businesses put at a competitive disadvantage,” he said. “It has taken policymakers far too long to get on top of it.”
Recently the federal government introduced a 12-month amnesty for employers over underpayment of the superannuation guarantee (SG). New laws could see employers hit with court-ordered penalties and even imprisonment.
But Mr Linden says that although the draft legislation introduces enhanced penalties and extended single-touch payroll to small businesses, it “doesn’t reflect the changing nature of work, nor does it fully harness technological improvements that have occurred since the introduction of compulsory super over a quarter of century ago”.
He goes on to argue that the draft legislation “continues to shut hundreds of thousands of workers out of the compulsory-superannuation system by retaining the $450-a-month threshold” and that it “fails to shift the frequency of SG payments from quarterly to monthly or fortnightly to align with wage payments and enhance transparency”.
