Unpaid super

Step 1

Firstly, you need to make sure you are eligible to receive super.

Generally, you’re entitled to super guarantee contributions from an employer if you are over 18 years old. It doesn’t matter if you’re full time, part time or casual, or if you’re a temporary resident of Australia – you’re still entitled to receive superannuation contributions. If you’re under 18 years of age, you must work more than 30 hours in the week to be entitled to receive compulsory super contributions.

You may also be eligible if you’re a contractor. Under superannuation law, if you’re a contractor who is paid wholly or mostly for your labour, you’re considered to be an employee and therefore entitled to super guarantee contributions just like any other employee.

Step 2

Check your last Member Statement from your super fund or contact them to confirm whether your employer has paid your super contributions for the period you are looking into.

Most employers don’t set out to fall behind in their superannuation payments but when times are tough they may not prioritise super. Therefore it is important to check your super is being paid regularly. Because if the company goes out of business it may be too late to recover your unpaid super.

Step 3

Talk to your employer. Most of them do the right thing, however sometimes employers miss payments or stop paying. You should ask your employer:

How often they are currently paying your super?
How much is being paid?
To which fund is it being paid?

Also ask them if you are eligible to choose your own super fund.

Step 4

Your super fund or union may also be able to help you if you are not comfortable speaking to your employer.

Step 5

If you have completed Steps 1, 2, 3 and 4 above and still believe your employer is either:

not paying any super
not paying enough super, or
not paying into your chosen super fund

…then you should report unpaid super by lodging an enquiry with the ATO, who will then take up the investigation into your unpaid superannuation.

You can also call the ATO on 1800 060 062 to make a confidential tip-off if you want to keep your identity confidential.

When should your super be paid?
See the dates

Penalties for not paying super

Employers who do not pay the correct super for their employees may have to pay a superannuation charge which is made up of the shortfall amount, interest on that amount (currently 11%) and an administration fee. Employers are also required to keep accurate superannuation records. The Australian Taxation Office (ATO) can take stronger action if an employer doesn’t pay the charge including issuing an ATO penalty notice directing the employer to pay the unpaid super. Failure to abide by a penalty notice can result in significant fines and possible imprisonment for company directors. The charge is not tax deductible; another reason why most employers do the right thing and make their super guarantee contributions on time.

Legislation recently passed by the government amends the Superannuation Guarantee (Administration) Act 1992 and closes a legal loophole that allowed employers to short-change employees who make extra salary sacrifice super contributions by calculating compulsory super on the lower wages after salary sacrifice contributions were deducted. From 1 July 2020, employee salary sacrifice arrangements will not reduce nor satisfy employers’ required super guarantee contributions (currently 11%).