The Greens have urged the Albanese government to make superannuation theft a crime, after failure to pay super was not included in the proposed wage theft offence in Labor’s closing loopholes bill.
The Greens’ employment spokesperson, Senator Barbara Pocock, has warned that unpaid super is costing workers at least $3.3bn a year, more than double the amount estimated to be lost through wage theft ($1.3bn).
Despite the assistant treasurer, Stephen Jones, saying the failure to pay super should be treated “in the same way as wage theft”, Labor’s industrial relations bill does not include it in the new offence.
The employment department claims that “criminal offences already apply in relation to non-payment of superannuation” but earlier in September Guardian Australia revealed that the Australian Taxation Office has never used its powers to issue a direction to pay notice. Failure to pay the notice is a crime, not the non-payment of superannuation itself.
Pocock said that Labor should “send a strong message to corporations … if you steal super from your workers you will pay the price … In the most egregious cases, you will face criminal prosecution and go to jail.
“Super theft is wage theft and the Greens want it treated as such under workplace law.”
Industry Super estimated that in 2018-19 employers failed to pay $5bn a year of super, meaning the one-quarter of employees affected are out of pocket on average $1,700 a year. The ATO estimated 4.9% of super was not paid in 2019-20, or $3.4bn.
Pocock said “victims of super theft are disproportionately young, low paid or migrant workers … most commonly workers in accommodation and food services, retail and construction”.
“Super is not an optional extra. It’s a workplace entitlement that protects a decent life in retirement for millions.”
The closing loopholes bill, introduced by the workplace relations minister, Tony Burke, earlier in September, contains a range of reforms criminalising wage theft, guaranteeing same job same pay in labour hire, providing minimum standards in the gig economy and improving the rights of casuals.
The construction union’s national secretary, Zach Smith, said while criminalising wage theft nationally “is an important first step”, unpaid super should have been “included in this bill, but if not it should be included in future changes to wage theft laws”.
The Greens have already called for Labor to add a right to disconnect to the bill, which would allow workers to refuse to answer work phone calls and emails out of work hours.
Given the Coalition opposes the bill, Labor will need the Greens’ 11 Senate votes to pass it, along with two more crossbench votes.
However, the Greens have not specified whether their recommendations on the right to disconnect and super theft will be conditions for their support.
In June Labor added superannuation to the national employment standards, which will give workers and unions more legal options to recover unpaid super debts rather than relying on the ATO.
The ATO boasts it has recovered hundreds of millions of unpaid super, but Industry Super has said it “dismally only recovers about 15% of unpaid super in a year”.
The Albanese government hopes unpaid super will be eliminated by payday super reforms, which require employers to pay super at the same time as wages rather than quarterly or six-monthly.
On Monday Jones said that “payday super, phased in by 2026, should reduce the problem to zero because the wages and superannuation are being paid at the same point in time”.
“We’ll look at whether we need to align all the other laws once we have that in place … We can look at the overall penalties that are involved once we get all these other building blocks in place.”
Jones said that when he raised the issue with the ATO it noted that much of the unpaid super was owed by businesses in insolvency or under administration.
