Thousands of employers will be given a one-off chance to come clean about unpaid superannuation, which is expected to return more than $200 million to Australians.
In legislation which passed through Parliament on Monday, employers will be given a six-month window to come forward and pay back superannuation owed to workers.
It’s expected that more than 7,000 bosses will come forward during the amnesty to avoid paying fees which could amount to double the unpaid super.
That’s on top of the 7,000 employers that have already come forward since the amendment bill was introduced in May 2018.
The Assistant Minister for Superannuation Jane Hume expects the bill to return millions in lost superannuation to Australians.
“This means that in total around $230 million of superannuation will be paid to employees who may have otherwise completely missed out,” she said in a speech in late January.
She acknowledged that some people may oppose an amnesty for wrong-doing employers, but that the aim is to “reunite hard-working Australians” with their superannuation.
“Just wielding the stick won’t encourage employers who want to set the past right to come forward,” she said. “In fact, it encourages them to hide.”
“Let’s do our best to clean up the past, too, and make whole those employees who have missed out on what they are rightly owed.”
“We encourage employers to check they don’t owe outstanding super – and if they do, to take advantage of this once-only opportunity to set things right before much tougher penalties apply,” Hume said.
The amendment bill: the details
The amnesty seeks to encourage employers to come forward by lessening the sting that usually comes with late payment of super.
Employers caught out for underpaying super that don’t take advantage of the amnesty will have to cop the typical fines, which is generally a 100 per cent penalty on top of the actual superannuation that is owed, stretching to 200 per cent in serious cases.
Once the Treasury Laws Amendment (Recovering Unpaid Superannuation) Bill 2019 receives royal assent, the amnesty will expire in six months.
In the meantime, the Australian Taxation Office will continue its usual auditing and enforcement activities for employers who choose not to own up.
How you can spot superannuation theft
Speaking to Yahoo Finance, FairVine Super head of customer experience Rachel Hamlen said that employees needed to be crystal-clear about what exactly their superannuation entitlements were.
“If you’re earning $450 or more per month with a single employer, then you’re entitled to receive a minimum of 9.5 per cent of your wage into your designated super fund. However, some employers pay more than the minimum rate, so it pays to check what your employment contract stipulates,” she said.
Your monthly payslip will state what your super payment is, but Hamlen had an important point to note.
“Although it’s worth noting that just because a super payment has been noted on your payslip, it doesn’t mean your employer has actually paid it,” she said.
Employers only need to pay super to workers every quarter. “So what often happens is that they withhold super payments (similar to income tax) and only pay them every three months.”
How to check if you’ve been paid super
To check whether or not you’re being paid your super, check directly with your super fund, Hamlen advised.
“Armed with knowledge of how much you’re entitled to as a percentage of your salary, you should be able to figure out how much you should have in your fund at a minimum (obviously, the returns you receive every year on your super should make that total amount higher).”
Some super funds may have additional features that help you keep a tighter eye on your super, such as receiving a notification from your super fund every time your employer makes a super contribution.
What to do if you’ve been underpaid your super
“Your first port of call should be your employer,” said Hamlen. In some instances, it may genuinely be a mistake, and you should arrange with your employer for them to make up for the shortfall.
But don’t forget to document these interactions with your employer, too, in case you need to take it to the ATO.
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