In 2022 the Albanese government made an election commitment to include an employee’s right to superannuation in the National Employment Standards (NES). Considering this promise, the Albanese government has recently completed a Workplace Reform Consultation which explored the feasibility of amending the Fair Work Act 2009 (Cth) (FWA) to incorporate such a right.
What is the current situation?
The FWA is the key piece of legislation which governs the rights and obligations between employers and employees. Currently, there is no requirement in the FWA that forces employers to make superannuation contributions on behalf of their employees. Instead, the only source of an employer’s obligation to pay super is found in the Superannuation Guarantee (Administration) Act 1992 (Cth). It is only the Australian Taxation Office (ATO) who can bring a claim for missed or underpaid superannuation contributions.
There is one exception to this lack of recourse. All modern Awards must contain a term requiring employers to make superannuation contributions, meaning employees covered by a modern Award cannot conduct an action against their employers directly for missed or underpaid super. Whilst this provides some protection, not all employees are covered by an Award leaving a number of people without direct remedy if their employer defaults on its super obligations.
What will a right to superannuation mean for employees?
Inserting a right to superannuation in the NES will provide more consistent and certain protection against employers who do not meet their superannuation responsibilities. Such a right will create an avenue where employees can apply directly to the Fair Work Commission (FWC) for an order of contravention if their superannuation is unpaid or underpaid. If the FWC finds an employer has contravened their obligations, the employer can be ordered to compensate the unpaid amount to the employee’s superannuation account as well as pay interest on that unpaid amount.
Whilst this change to the FWA is yet to be drafted as a Bill or approved by Parliament, the conducting of a Workplace Reform Consultation has been activated to investigate and recommend a way forward.
If you would like to know more about these possible changes and the impact that a right to superannuation will have, please do not hesitate to contact Daniel at email@example.com.