More Australian workers will be able to sue their employers to recover billions of dollars in pension savings that have been stolen or withheld from them.
(Bloomberg) — More Australian workers will be able to sue their employers to recover billions of dollars in pension savings that have been stolen or withheld from them.
The government will introduce new legislation this week to make it easier for workers to pursue the underpayment of pensions, known locally as superannuation, according to a statement Wednesday. Workers lost about A$3.4 billion ($2.3 billion) to the problem in 2019-20, the government said.
“It is simply not good enough that employees are missing out on their superannuation,” Workplace Relations Minister Tony Burke said in a statement. “No employee should have their retirement incomes sabotaged by dodgy or negligent employers.”
Currently, workers chasing unpaid superannuation must rely on the Australian Tax Office to intervene. A 2022 report found the ATO’s work addressing the issue was “partly effective” and the new laws will complement the organization’s powers, the government said.
Under Australia’s A$3.4 trillion retirement savings system, employers are required to pay 10.5% of worker salaries into superannuation, and can face civil penalties for failing to do so. The proposed law change would allow workers not covered by a modern award or enterprise agreement to take direct legal action.
“This legislation will increase the number of employees who will have the right to directly pursue superannuation owed to them,” Burke said. “This government stands against all forms of wage theft and worker exploitation.”
Industry body, the Association of Superannuation Funds of Australia, said while it welcomed the legislation, it wanted the government to force employers to make pension payments at the same time as salaries. Currently, employers are only obligated to make the payments quarterly.
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.