Superannuation, as we know, is a legal obligation on the part of all employers to contribute a minimum percentage of each employee’s earnings to a compliant superannuation fund or retirement savings account. Currently the superannuation guarantee contribution rate is 9.5% of a worker’s ordinary time earnings.This rate will increase by 0.5% on 1 July 2021. Further increments will apply annually up until 2025/26 when ultimately the superannuation guarantee rate will be set at 12%.

This of course is good news for all employees. It is however only good news if the superannuation guarantee rate is in fact paid by the employer.

Currently an employer must pay the superannuation guarantee at least four times a year, by the quarterly due dates. A report by Industry Super provides that one in three Australian workers are owed superannuation benefits. It suggests that this problem would be largely resolved if the legislation was changed so as to provide that an employer had to make the superannuation contribution when wages or salary were in fact paid.

All workers should ensure that they are being paid superannuation guarantee benefits and at the correct rate. The simplest way to do this is to contact your superannuation fund directly. They will be able to provide to you all relevant information concerning payments. It is recommended that such checks are undertaken regularly given the current reporting obligations only impose a quarterly payment schedule for employers.

If an employer fails to make payments at all, for example if the business is having financial problems, and it ceases trading, then the worker may miss out on the contributions which are owed. In recognition of this problem the Government has proposed an amnesty in legislation introduced into Parliament on 18 September 2019. It proposes to provide an amnesty to delinquent employers so as to enable the payment of superannuation benefits without additional charges being imposed. The legislation is yet to be enacted.

If you believe that you are owed superannuation benefits by your employer then you can engage the assistance of the Australian Taxation Office. The ATO will engage with employers to address the outstanding debt and failing same, can take stronger action including penalty notices issued directly to directors and garnishee notices issued to the employer for monies owed.