A Senate Committee inquiry into the proposed Super Guarantee amnesty has split along party lines.
Unsurprisingly, a Senate inquiry into the proposed amnesty for employers who haven’t paid the Super Guarantee they owe has recommended along party lines – with the Coalition saying the Bill should be passed, and Labor that it should be opposed.
The Government is having a second attempt at passing an amnesty for historical non-payment of Super Guarantee, after the first attempt failed to pass before the amnesty was supposed to finish.
The majority of the Committee recommends that the new Bill be passed. The Committee comprises three Coalition Senators, two Labor and one Centre Alliance.
“The committee heard evidence that the one-off amnesty will leave no workers worse off and will result in more individuals receiving their full entitlements than would do so if the amnesty was not in place,” says the majority report.
The Committee is “confident that the one-off amnesty provides the best opportunity to address historical superannuation guarantee non-compliance,” when combined with “forward-looking compliance reforms” such as Single Touch Payroll.
The majority also attributed a fall in the Super Guarantee gap – a measure of underpayment – in part to the over 7,000 employers who came forward when the first amnesty was announced but not implemented.
“In the committee’s view, this significant level of disclosure, even prior to the legislation being enacted, is a strong indication that the amnesty will achieve its projections of recovering over $230 million in superannuation for employees who would have otherwise missed out.”
The majority also recommend the ATO have a “communication strategy to maximise employer awareness and engagement with the superannuation guarantee amnesty”.
Labor members of the Committee issued a dissenting reporting opposing the Bill, saying that “non-compliance of the superannuation guarantee is a form of wage theft”.
“When an employer forgoes paying superannuation to their employee, they are taking what was legally owed to them,” said the Labor Senators.
“The inquiry made clear that the amnesty seeks to reward bad behaviour over good behaviour. This bill would not penalise wage theft—instead, it would reward it by allowing employers to make deductions. Furthermore, it punishes employers who are doing the right thing, by allowing their competitors to gain a competitive advantage through non-compliance.”
Labor is also concerned that the amnesty won’t uncover all unpaid Super Guarantee, as employers are only required to keep records for so long.
Instead of an amnesty, the Labor Senators say a better solution is “strategic audits” by the ATO for historical non-payment combined with Single Touch Payroll going forward.
“This is a poorly conceived bill. It is the product of a government that is soft on wage theft. The evidence to this committee was that the bill was unlikely to achieve even its modest aims, at the cost of rewarding and incentivising poor behaviour from employers.”
The Treasury Laws Amendment (Recovering Unpaid Superannuation) Bill 2019 has yet to pass the House of Representatives, and was last debated on 18 September 2019. Only the Senate is sitting this week; the House next sits on 25 November.