NXT Bill to help millions of workers claw back billions in unpaid Super

21 Jul 2020

Posted September 11, 2017

The Nick Xenophon Team wants to bring in stronger laws to help Australian workers fight for billions of dollars’ worth of retirement savings lost through unpaid super.

Photograph: Federal Member for Mayo Rebekha Sharkie and Senator Nick Xenophon, centre, held a press conference on Sunday with Travis Dobie, left, and Terry Strout, right, two Hills men owed tens of thousands of dollars unpaid superannuation.

Federal Member for Mayo Rebekha Sharkie is introducing a Private Members Bill today that seeks to give employees more power to pursue unpaid superannuation contributions and earlier warnings when employers fail to pay their entitlements.

“There are at least 2.4 million workers in this country who have been underpaid their super, ripping out $3.6 billion from retirement savings,” Rebekha said.

“If we don’t do something to make it easier for workers to find out that they haven’t been paid their full entitlements, and give them more power to stand up for their rights, that retirement rip-off is going to balloon out to $66 billion by 2024, according to Industry Super Australia.

“In my own electorate of Mayo, there were 12,896 employees who had been underpaid their Super last year, missing out on an average $1748 per person per year.

“This amounts to a staggering 28% of all employees in my electorate who are entitled to employer-paid superannuation contributions, but are then underpaid those entitlements.”

Under current laws, the superannuation guarantee is a charge that is only owed by employers to the Australian Taxation Office (ATO), not to employees.

This means that the main avenue workers have to recover their entitlements is to lobby the ATO to recover their Super on their behalf.

NXT’s Fair Work Amendment (Recovering Unpaid Superannuation) Bill 2017 seeks to strengthen the operation of Australia’s superannuation system through a number of provisions by:

  • Including superannuation contributions within the National Employment Standards. This would give the Fair Work Ombudsman the authority to pursue recovery of unpaid employer superannuation contributions. Employees would also have a direct legal avenue to recover unpaid superannuation;
  • Enabling employees to more effectively track if and when superannuation contributions are made to them by their employers, by requiring employers to provide notice of when contributions are made (or not paid) for each pay period;
  • Removing the loophole which currently allows employers to potentially claim employee contributions made via salary-sacrifice as employer contributions;
  • Removing the exemption that currently exists for employers that allows them to not to make superannuation contributions to employees who are paid less than $450 in wages in a calendar month;
  • Requiring the Commissioner for Taxation to conduct a review of employers’ compliance with their superannuation payment obligations;
  • Creating a duty for trustees of superannuation entities to take reasonable steps to notify their members (within 28 days and by any means) when it could reasonably have expected their member to have received a contribution from an employer, but they did not;
  • Expanding the information that superannuation providers are required to provide to the Commissioner for Taxation in their annual Member Information Statements to better inform Government policy;
  • Removing restrictions for employees on their choice of Super Fund.

“We believe these measures will help workers recover unpaid superannuation from their employers and allow the Government to track superannuation more effectively and help identify problem employers,” Nick said.

“Rebekha and I have been contacted too often by people who have been the victims of unscrupulous employers, who sometimes learn only too late that their employer has not being paying their superannuation for many months, or even years.

“All too often, the employer eventually winds up their business, and manages to avoid paying either most or the entirety of the outstanding amount of superannuation that they owe their employees.”

NXT’s Bill was compiled after examining the submissions and evidence from the Industry Super Australia and CBUS report Overdue: Time For Action on Unpaid Super and the Senate Inquiry report Superbad-wage Theft and Non-compliance of the Superannuation Guarantee.

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