For those of us who are eligible to receive employee super contributions, the process happens without much effort on our part. In reality, though, many Australians are not being paid the correct amount of super or not being paid on time.
We also know that it’s a problem that disproportionately impacts sectors with more women and marginalised groups as workers, like freelancers, contractors, and the service industry.
If you are employed, then your employer is most likely required by law to contribute money to your super. But there are a few exceptions, which include:
- If you earn less than $450 per month, before tax.
- If you are under 18 and work less than 30 hours per week.
- If your work is of a domestic or private nature, and you work less than 30 hours per work.
- If you are not a resident of Australia and complete your work outside of Australia.
You can use this handy tool to check if you are entitled to super.
How many Australians might be missing out on super?
According to the ATO, 96% of employees are getting paid the correct amount of super. That leaves 4% who aren’t, which equates to $2.4 billion dollars in unpaid super across Australia.
Here are the steps you can take to check you are being paid the correct super, and what to do if you spot a problem.
It’s worth noting here that your super should be paid into your fund at least every three months. And not having your super paid on time can also affect your ability to achieve investment returns.
Know what you’re entitled to
If you’re earning more than $450 per month before tax, then by law, your employer should be paying a Super Guarantee Contribution (often referred to as an “SG contribution”). This is the contribution that they make to your super account on your behalf.
The current rate for SG contributions is 10% of your ordinary time earnings* (OTE). This rate is set to increase by 0.5% each year until it reaches 12% by 2025.
*Ordinary time earnings is the amount you earn for your ordinary hours of work. It includes over-award payments, commissions, shift loading, annual leave loading, allowances, and bonuses. You can find a full list of payments that are ordinary time earnings here.
To check you’re being paid your super correctly, first, you need to know exactly what you’re entitled to. Your salary package will show what you negotiated when you started or renegotiated your contract. Is your salary before or after superannuation? Being clear on this figure helps you to work out how much super you should be receiving.
To help, you can also use this calculator on the ATO site. This gives you a guide on how much your employer should be paying into your fund quarterly.
Compare this with your super statements
Now you know what you should be receiving, log into your super fund or your My Gov account via the ATO to check everything adds up.
Some funds will have a real-time transactions list, which shows what’s been added to, and withdrawn from, your account. If your super fund doesn’t offer this functionality, head to the annual statements section. These statements provide an overview of your account for the last financial year. They will show the balance of your account, as well as contributions made throughout the year, any insurance cover you have, and the fees associated with the fund.
As mentioned, being aware of the timeline of your super payments is just as important. By law, your employer is required to make an SG contribution to your super at least quarterly. Some employers will make monthly contributions.
If your super summary looks correct, then keep doing what you’re doing! But continue to check in regularly to ensure nothing has changed. If not, there are a few more steps you can take to ensure you get paid what you’re owed.
Check that your super fund has your Tax File Number (TFN)
Once your super fund has your tax file number on record, it makes it a whole lot easier to share your super information with the ATO.
By supplying your TFN, your super fund will also pay less tax on employer contributions (which means that cash goes to you instead, woo!). You’re also less likely to lose track of your super accounts because your TFN is the primary link to your account, and it’s easier to consolidate your account if you choose to do so. You’re also able to make personal contributions to your account which means you might be eligible for a government co-contribution. All positives – so grab that TFN and get it sent to your super fund!
Now here’s what to do if you’ve discovered your employer isn’t paying your super correctly.
It’s worth talking to your employer or payroll manager as soon as you find any kind of discrepancy with your superannuation payments.
Although businesses should be on top of the superannuation laws and expectations, we’re all humans and sometimes things can slip through the cracks. It pays to raise your concerns and see what can be done. This can result in payment of any missed super, as well as being paid correctly going forward.
Contact your super fund
It’s also worth chatting to your fund directly if you ever have questions about your super payments. In some cases, employers have contractual agreements in place with certain super funds. This means they can follow up on any missed payments on your behalf. If you’re a Verve member we’re happy to speak directly to your employer, with your permission, to sort it out. They can also answer any questions you have and help you resolve any issues you might have uncovered.
Take the legal route and lodge unpaid super with the ATO
If you’ve taken all the previous steps to no avail, then you are able to lodge a report with the ATO using this online tool. This allows you to report instances of your employer not paying your super on time, not paying into the correct fund, or not paying it at all.
Note, you’ll only be able to have your employer investigated once the lodgement due date has passed. For example, if you’re reporting a missed super payment for the period 1 July 2021 to 30 September 2021, it won’t be investigated until after the lodgment due date of 28 November 2021.
When lodging a report with the ATO, you’ll need to provide personal details, your TFN, the period your report references, and your employer’s details, including their ABN. If you’re concerned about reporting your employer, you do have the option to report them anonymously.
Seeking additional support and legal advice
You can also contact the Fair Work Ombudsman to assist you in any workplace issues. If you haven’t had a response by the time you leave your job (whenever that may be), then it’s worth seeking legal advice. Once you leave a job, you lose that direct line of contact with your employer, and getting the situation sorted may be trickier. That said, you’re still entitled to your super payments even after you leave a place of work. It can still be well worthwhile to push on in order to get what you are owed.
Other helpful things to remember!
Resolving issues with missed super payments is usually straightforward. But regardless of the circumstances, you should never feel guilty for following up on what you’re owed! An employer is breaking the law by not paying any obligatory super payments – plain and simple.
It pays to have a super fund in your corner, too! They can help you navigate the system and ensure you get exactly what you’re entitled to.
If you’re a Verve member with a question about your employer’s Super Guarantee, you can contact us today. Additional resources are also available via the ATO.
You can read more about self-employed super contributions here, and salary sacrificing here.