Institute of Certified Bookkeepers

Matthew Addison, Institute of Certified Bookkeepers
16th July, 2017

Another Perspective

As employers, our intention is not to rip off our workers.

Our negotiations at the commencement of employment and ongoing is to provide remuneration that motivates an employee and pays them in a mutually agreeable form.

Commercially and economically we only have a certain amount of resources. The decision to employ places us as committed to meeting the many obligations of being an employer including the direct financial commitments and the oncosts.

The argument is not about a Super Gap!

This should be a discussion about employment, the cost of employment! The allocation of the total remuneration from an employment between taxes, the employees living requirements and the need to place funds into super, arguably for future living requirements.

The discussion should be about efficient processes for employers, for superfunds and for government.

Observations

Anecdotal evidence is that until late in a person’s career they do not value super, in fact it is worse than that; they don’t believe the superfund is acting in their best interests. It is dead money!

It is the complexity of dealing with confusing messages and requirements of superfunds that create immense disengagement with superfunds. This applies for both employees and employers.

Employers hate dealing with the superfunds and their collection agencies who make demands upon employers that appear outside of requirements and legal obligations. (Examples of the unnecessary complexity being performed by superfunds: Nil remittance advices should not be required, monthly payments are not always required, payments are typically not required before the stipulated 28th day of the month following each quarter)

Recommendation

Allow employers and employees to continue to negotiate the dissection of their total remuneration package.

Continue to require at least 9.5% Super to be required as part of the package. Noting that if an employee negotiates that they want to have a total of, say, 12% contributed, then that can be inclusive of the 9.5% required.

Reduce the complexity of an employer’s business process by insisting funds only require what is legally required or required by industrial agreement.

Continue to support an appropriate implementation of Single Touch Payroll. The visibility that this system should bring to ATO as regulator of super, as to whether an employer is accruing super and paying super is an improvement to the current environment. We support the concept that Single Touch Payroll should be implemented for all employers but not until the ATO has provided the complete specifications and details to software providers in sufficient time to enable efficient and easy transition of the employers’ payroll systems. It is very possible but we are not there yet.

Conclusion

Employers are not, always, the super problem!

References

  • 17th July, 2017
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