Employers who hang on to rather than pay workers super contributions will face up to 12 months in prison under planned new legislation, the Canberra Times reports.
Until now the Australian Tax Office has only been able to impose financial penalties, and only up to twice the value of contributions withheld.
In arguing for tougher sanctions, Financial Services Minister Kelly O’Dwyer has pointed to an employer in the construction industry who underpaid superannuation contributions for 170 workers over two years at a cost of $1.96 million, an employer in the NSW café and restaurant industry that underpaid contributions for 100 workers for five years at a cost of $1.72 million, and an employer in the Victorian hairdressing industry who underpaid contributions for 100 workers for more than two years at a cost of $623,000.
“Employers that do not meet their superannuation obligations are breaking the law, it is fundamentally unacceptable,” she will say.
The amendment will allow the Tax Office to apply for court-ordered penalties, including jail time. It will also require the office to search for non-compliance rather than waiting for workers’ complaints.
It will also allow the Tax Office to notify workers when it is recovering money on their behalf.
Jail for employers who underpay super under new law (Canberra Times)
Super Risk (ABC Four Corners)
Kelly O’Dwyer / APH