Super Guarantee amnesty for employers passes Parliament

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The Government has succeeded in passing an amnesty for employers who haven’t paid the Super Guarantee they owe to workers.

This is the second attempt by the Government to pass such an amnesty; after announcing the original 12 month amnesty would apply from the date of announcement, the Government was then unable to pass it though the Parliament before the 12 months was up. The Government says that over 7,000 employers came forward with non-payment of Super Guarantee before the amnesty was legislated, and expects a further 7,000 to come forward over the next six months.

The Government argues the amnesty is about recovering unpaid historical superannuation, something it says will be less of an issue in the future with systems such as Single Touch Payroll.

Following the passage of the Bill, Assistant Minister for Superannuation, Financial Services and Financial Technology Jane Hume said: “Employers will not be off the hook. To use the amnesty, they must still pay all that is owing to their employees, including the high rate of interest. However, the amnesty will make it easier for workers to secure the super they are owed by not hitting employers with the penalties usually associated with late payment.”

Labor has said the amnesty rewards “wage theft”, and argued that it allows employers to “wipe the slate clean” if there aren’t records stretching back far enough to show all the super they owe.

Labor unsuccessfully attempted to amend the Bill to include superannuation in the National Employment Standards (NES) – which would have made it easier to pursue the non-payment of superannuation without the involvement of the ATO.

Assistant Minister Hume has reportedly given a commitment to Centre Alliance – who voted for the Bill – to consider the proposal to include superannuation in the NES during the next six months.

The Bill, without amendment, passed the Senate 37 votes to 31.

According to the explanatory material to the Treasury Laws Amendment (Recovering Unpaid Superannuation) Bill 2019, the new Super Guarantee amnesty started on 24 May 2018 (when the original amnesty was announced) and ends “6 months after the day this Act receives the Royal Assent” – a date yet to be determined.

The amnesty also doesn’t apply to non-payment of Super Guarantee that occurred in the quarter the amnesty was originally announced, or later quarters: “An employer will not be able to benefit from the amnesty for SG shortfall relating to the quarter starting on 1 April 2018 or subsequent quarters.”

Employers coming forward under the amnesty will not have to pay a number of the penalties usually applying to the late payment of Super Guarantee. But penalties going forward will be increased.

The amnesty is expected to raise $99 million for the Budget over the four year forward estimates.

The Government previously legislated potential jail sentences for employers not paying Super Guarantee.

Amnesty rewards bad employers, punishes good

The Australian Institute of Superannuation Trustees has warned that giving employers who haven’t paid Super Guarantee an amnesty could worsen “super theft”.

AIST CEO Eva Scheerlinck said that waiving penalties for employers not paying super sent the wrong message.

“Superannuation is deferred wages and, in a compulsory super system, members must receive their full entitlements when they are due. Rather than providing an amnesty, strengthening employer penalties for failing to pay super is needed.”

“An amnesty creates a situation where you’re rewarding bad employers and punishing good ones.”

“Unpaid super is a billion dollar problem that amounts to theft. Instead of an amnesty, employers need to be prosecuted for contravening the law.”

Industry Super Australia has also criticised giving an amnesty while not doing more to tackle the underpayment of super.

“That members will be reunited with their super is a good thing, but this Bill does little to fix the causes of the $6 billion unpaid super scandal,” said Industry Super Australia Chief Executive Bernie Dean.

“One in three Australian workers have been ripped off by a dodgy boss and with enforcement sadly lacking they do so without fear of punishment.”

“The chance to address unpaid super was now and because the government failed to act on important reforms 2.85 million Australians will continue to be ripped off.”

Industry Super Australia notes that the $200 million expected to be recovered under the amnesty is less than 5% of the annual amount of unpaid superannuation, and that the amnesty does “little” to stop future underpayment.

The organisation says that including superannuation in the NES is a “important reform”, as currently workers have to rely on the ATO – whose enforcement has been “sadly lacking”.

“The ATO has only once issued a maximum penalty for unpaid super and has only recovered a fraction of members’ money – meaning an effective amnesty for dodgy bosses already exists.”

More to come.


Last week the House of Representatives passed the Treasury Laws Amendment (Your Superannuation, Your Choice) Bill 2019, which expands choice of super fund rules to more employees. The House also passed the Treasury Laws Amendment (Reuniting More Superannuation) Bill 2020, which would effectively shut down Eligible Rollover Funds and transfer the money to the ATO. Both Bills are now before the Senate.

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