Labor to introduce hefty fines for superannuation theft
Bill Shorten said retirement savings deserved the same strong protections as any other workplace rights. Photo: AAP
Workers will gain the right to sue their employer for their share of $5 billion in unpaid super if Labor wins the 2019 election.
The policy shift could deliver a windfall to an estimated three million Australians who are being underpaid or ripped off on employer contributions to their retirement savings.
Employers will also face fines of up to double the super debt if they fail to pay, and three times the debt if they fail to tell the Australian Tax Office when asked.
For the first time, the billions of dollars in superannuation that bosses have failed to pay their staff will no longer be regarded as a debt to the Australian Tax Office.
That means workers who are ripped off can launch legal action directly with employers.
Labor leader Bill Shorten announced the policy shift at the ALP conference in Adelaide.
“The retirement savings of Australian workers are a workplace right. They deserve the same strong protections as any other workplace right,” Mr Shorten said.
And bosses who rip off their staff and steal their super should receive the same punishments and penalties as those who violate any other workplace right.”
Labor’s treasury spokesman Chris Bowen said the Coalition’s only policy idea was to “provide a holiday on the fines”.
“They say you should have a 12 month amnesty from paying a fine for not paying superannuation. No we don’t support that,” Mr Bowen said.
“Currently unpaid or underpaid employer superannuation contributions are a debt owed to the Australian Taxation Office, rather than the worker.
“Unless there is a clause in their award or agreement, workers can’t chase this money – as the money is not technically owed to them.”
Mr Shorten also confirmed that if elected, the ALP would establish a review of Newstart, but stopped short of pledging to immediately lift the welfare payment.
“And for every Australian who can’t find a job, we will review and reform Newstart. Because that system should support people back into work, not punish them in poverty,” Mr Shorten said.
Industry welcomes new proposal
Industry Super Australia (ISA) warned nearly three million Australians missed out on a superannuation payment or payments in 2015-16, with the shortfall totalling $5.9 billion in unpaid super.
ISA chief executive Bernie Dean said the new measures to enshrine super rights in the National Employment Standards (NES) will make it “crystal clear to employers and employees what their respective responsibilities and rights are”.
“Super is an important employment entitlement that should be afforded the same prominence and protection as other basic conditions like maximum hours, leave and redundancy,” he said.
“In most circumstances employees have no legal standing to pursue super they are owed, placing the entire weight of the problem on the ATO to manage.”
But the super industry is urging Labor government to go further.
“The law needs to change to require super contributions to be paid at the same time their salary is paid,” he said.
“Many employers do this already because making smaller regular contributions makes for better cash flow management than allowing large liabilities to accrue.”