MELBOURNE, AAP – Victorian workers are missing out on about $1.2 billion a year in retirement savings, analysis by a superannuation industry body reveals.
According to Industry Super Australia, more than 760,000 workers were underpaid an average of $1606 in 2018/19.
ISA chief executive Bernie Dean says workers are mostly unaware of the problem.
“This is a $1.2 billion a year rip off affecting nearly a third of Victoria’s workers, yet many of them remain unaware, assuming super is being paid because it appears on their pay slip,” he said.
The ISA states workers must rely on the Australian Taxation Office to recover their unpaid super, but it only recovers about 12 per cent of unpaid super each year.
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Mr Dean is calling for new laws to ensure that super contributions are paid at the same time as wages, and says under the current rules super can legally be paid to workers just four times a year.
“Super is your money, you should get it paid at the same time you get your wages. By not mandating the payment of super with wages, politicians are stopping Victorian workers getting what they are owed,” Mr Dean said.
He also wants the ATO to crack down on employers who underpay super, and an extension of the Fair Entitlement Guarantee so that workers can recoup their money if a company goes bust.
The electorates of Holt in Melbourne’s south east and Corangamite near Geelong saw the greatest percentage of worker underpaid, with a third of employees missing out on super entitlements.
The highest average amount of unpaid super was in the electorate of Indi in the state’s north east, where more than 17,000 workers were underpaid $1749, according to the ISA.
In federal treasurer Josh Frydenberg’s electorate of Kooyong, 27 per cent of workers have been underpaid an average of $1535.
The ISA said workers who are underpaid super can end up retiring with up to $60,000 less in their nest eggs.
Victorian senator and minister for superannuation Jane Hume has been contacted for comment.