More than a quarter of Townsville’s workers have missed out on $55.8 million in super payments they earned, and the super rip-off will continue unless local politicians act.
Industry Super Australia (ISA) analysis of tax data shows more than 36,000 Townsville workers lost an average of $1,600 each in super in one year. Those dudded on super can end up retiring with up to $60,000 less.
Analysis shows that 28% of local workers have been ripped off on their retirement contributions – with young Townsville workers and those on lower incomes most likely to be underpaid, super rip-offs are sadly rampant in blue collar jobs and hospitality.
An ISA report, Super Scandalous how to fix the $5 billion scourge of unpaid super found dodgy bosses have exploited lax enforcement and loose laws that allows them to only pay super quarterly into the workers’ fund, despite what it says on a payslip.
The report’s key recommendation for fixing the unpaid super scourge is to mandate all employers pay super into a workers’ account when they pay wages.
Not paying super with wages makes it difficult for workers to keep track of their money and allows payments to fall through the crack. Federal politicians have known about this solution for years but have failed to act.
Unpaid super creates an unequal playing field, as the employers doing the right thing are undercut by competitors who are ripping their workers off.
Workers must largely rely on the Australian Tax Office to recover their money as it is difficult to sue for super. But unscrupulous employers do not fear the regulator, with good reason, the Australian Tax Office only recovers a dismal 12% of unpaid super annually and is reluctant to issue penalties.
If the ATO is unwilling or unable to recover workers’ savings the law should be changed so that employees, the Fair Work Ombudsman, and others acting on behalf of workers can.
To fix Townsville’s unpaid super scourge politicians should commit to:
- Mandate super payment at the same time as wages
- Lift enforcement activity and force the ATO to issue and publicise penalties for not paying super – so dodgy employers can see there is a cop on the beat.
- Empower employees and representatives to recover unpaid super debts.
- Extend the Fair Entitlement Guarantee so workers can recoup their savings if a company goes bust – at the moment super is not included.
Comments attributable to Industry Super Australia Chief Executive Bernie Dean:
“This is a $56 million a year rip off on a quarter of Townsville workers that politicians won’t fix.”
“Super is your money, you should get it paid at the same time you get your wages. Local federal politicians Phillip Thompson and George Christensen get their super paid on payday, they need to act to help local workers.”
“Most employers are doing the right thing, but they are being undercut by competitors who are getting away with daylight robbery. Paying super with wages is the only way to get workers their money and level the playing field for business.”
