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Casual workers getting raw deal on super

Getty

Getty

The taxman may have struck a blow for the rising numbers of Australian workers who miss out on superannuation.

A new ruling from the tax office means that pizza delivery drivers must be paid as employees and not contractors for the purposes of superannuation obligations.

While a win for these employees, this move could also shed light on other “grey areas” of employment, a superannuation researcher said.

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University of Sydney economist Dr Michael Rafferty told The New Daily that the decision is “potentially a quite powerful ruling” because “a whole swag” of Australians are missing out on super because of similar employment arrangements.

Poultry workers

Poultry workers are often misclassified as casual. Photo: Getty

“There are virtually no industries now in which these types of grey areas of work are not occurring,” Dr Rafferty said – a change that has “dissolved” many worker rights, including a comfortable retirement, sick leave, workers’ compensation, and protection from unfair dismissal.

National Union of Workers (NUW) national secretary Tim Kennedy told The New Daily that the estimated 40 per cent of Australians in insecure work struggle to set aside money for retirement, and that it is “unfortunately too common” for these employees to be “misclassified”.

These “insecure” workers are a diverse group including poultry workers, builders, researchers and interpreters.

Almost one in five, or 19 per cent, of Australian workers were casual employees in November 2011, Australian Bureau of Statistics data shows.

The union is calling on the government to make superannuation compulsory for all workers because the current arrangement, under which casual workers and independent contractors are not paid super, is “a driver of rising inequality for poorer workers” and “flies in the face” of fairness.

An ATO spokeswoman confirmed to The New Daily that it “continually monitors” the market for employers who are not paying the correct amount of super and other entitlements, and that some unscrupulous bosses “across a number of industries” deliberately dodge these obligations.

But the law in this area is “complex” and workers “often” miss out on super because they and their bosses do not fully understand the law, the ATO said.

The New Daily investigates whether you should be getting paid super.

translator performer money

Translators are another type of worker who has been underpaid super in the past. Photo: Getty

Are you a casual worker?

According to the tax office, your boss must pay 9.5 per cent of the value of your ‘ordinary time earnings’ into your super fund if you are older than 18 and earn more than $450 before tax in a calendar month.

If you are younger than 18, you are still entitled to the same amount of super if you work more than 30 hours a week and earn more than $450 in the calendar month.

Do you work multiple jobs?

Casual workers who earn more than $450 in a month can miss out on the minimum superannuation contributions if they work more than one job. That means if you earn $300 in one job and $300 in another, you won’t get paid compulsory super.

Apprentices and trainees

If you are an apprentice or trainee, you are considered an employee for tax and super purposes and cannot be hired as a contractor, so keep that in mind.

Are you in a sham contract?

Senior associate Jessica Alcantara from law firm Maddocks told The New Daily that if an employer wants to engage a worker on an independent contactor basis, both the words of the contract and the substance of the working relationship must support this.

For example, a written contract saying “you are an independent contractor” does NOT trump the fact that the working relationship looks like full-time employment – such as the worker having to perform the work personally with no right to delegate, Ms Alcantara said.

High-profile cases in recent years have concerned researchers, interpreters and translators, but anyone who works as a contractor may be at risk of unfairly missing out on super and other entitlements, she said.

builders, home, construction

A union estimates that up to 40 per cent of Australian workers, such as contract builders, are employed insecurely. Photo: Getty

If an employer fails to pay the right amount of super, they can be slugged with penalty interest and an administrative fee of $20 per quarter per employee on top of the super payments they owe.

If you think you are unfairly employed as an independent contractor, you should:

• Consult a lawyer
• Contact your union
• Check out the ATO’s Employee or contractor online tool
• Read the ATO’s definition of an employee
• Call the Fair Work Ombudsman on 13 13 94.

How can I check if I’m being paid super?

Employers must tell you how much super you are being paid in your pay slip, so check there first. You could also contact your fund directly, or look at your annual statement, to double check on what is going in.

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