Industry funds call for changes to the super pay cycle

0

Several industry super funds are calling for employers to pay their workers’ superannuation via the same cycle as their salaries.

In an attempt to stop workers from being bilked of their retirement savings, industry super funds say that changing employer superannuation payments from quarterly to fortnightly or monthly cycles would reduce the temptation of businesses to avoid paying their super contributions.

Under the superannuation guarantee (SG), employers have an obligation to pay 9.5 per cent of workers’ entitlements into the individual’s super fund. While these payments are divided into the amount owing for the pay period and appear on the employees’ fortnightly pay slip, the actual payment is due quarterly.

Close to seven per cent of Australian workers have unpaid super. Those who work for smaller businesses or in industries where contracting is common are at greater risk of receiving late payments or missing out completely because the employer falls behind.

Super funds are under no obligation to ensure that contributions owed to members arrive in their accounts, as it is the sole responsibility of employers to make payments and the ATO to monitor compliance.

Industry super funds believe that quarterly SG payment cycles make the early identification of late-paying or problematic employers difficult, whereas super payments in a payroll cycle could help with earlier identification and intervention.

Some employers have already been found to be voluntarily moving towards making super payments in the same cycle as salaries and wages.

Share.

About Author

Leave A Reply

Pin It on Pinterest