When Coco* asked her former boss why she hadn’t been paid her super, she was told “not to worry, it’s paid quarterly”. But as time went by, and with red flags flying ominously, she felt helpless.
Despite months of enquiries and reassurances that payment would come, her worst fears were realised when her employer went into liquidation. This left her and colleagues without thousands of dollars in super payments they had earned and were legally owed.
Almost every week we hear similar stories to Coco’s. Many follow a similar pattern, where a lack of awareness and assumed trust, combined with an out-of-date obligation on employers to only pay super every three months, allows unpaid super to flourish.
Analysis by the Super Members Council of unpaid super in Australia shows around 3.3 million people miss out on $5.7 billion a year in retirement savings. That’s $110 million a week going unpaid. Over nine years, that has, cost Australians a shocking $47 billion.
The average affected worker misses out on $1,730 in super in a year. Women, people in insecure jobs, and young workers are most at risk. This adds up – making workers up to $30,000 worse off at retirement.
While these numbers are bleak, there is a solution. One that will create a more simplified system for workers and employers than the current legal requirement for super to be paid only once a quarter, while protecting the retirement savings of millions of Australians. Many businesses already do this.
Payday super laws – which will see super paid at the same time as wages, making it easier for workers to monitor payments and levelling the playing field for employers, are due to come into effect on 1 July 2026. But legislation to make this happen still needs to be passed by Parliament.
While there have been recent calls by one or two voices to delay the reforms, each week they are delayed, one quarter of Australia’s workforce is a combined $110 million poorer. And that means less money to pay the bills in retirement after a lifetime of hard work. Australians cannot afford to wait a day longer.
To smooth the transition for employers, we’ve proposed a couple of practical ideas to help.
These include having super land in workers accounts within 7 business days of paydays. We’ve also proposed a phased approach to ATO enforcement in the early stages to give comfort to employers genuinely trying to do the right thing. Finally, we’ve called for employers to be able to validate a worker’s correct super account details in real time to help eliminate processing errors when super is paid. Each of these will help to secure this crucial reform.
Implementing the laws as planned next year has strong community support. A new survey for the Super Members Council finds more than 70 per cent of Australians want these laws to start on 1 July 2026. Fewer than 1 in 10 people think the reforms should be delayed.
We have a sensible timeline and public goodwill to implement these historic laws. And what a powerful legacy they will be for the Government and the Parliament.
All that’s missing now is a sense of urgency to pass the legislation, so millions of Australians don’t live a story like Coco’s. So, let’s get on with it – and get them paid.
By Misha Schubert, CEO of the Super Members Council of Australia.
*Real name protected.
