Australian teens could gain $405m per year in superannuation after a Labor policy “stepped in” to close an unfair loophole.
During their annual conference, the party agreed to mandate businesses contributions regardless of how many hours under 18s work each week.
While the current legislation forces businesses to pay young workers if they work more than 30 hours per week, the new policy would remove this condition altogether.
A report by Super Members Council found the change would impact around 515,000 Australian teenagers, granting them the full super benefits 17 million other residents already experience.
Labor said the policy choice will ensure “all workers, including those under 18 and regardless of how they are engaged, can accumulate superannuation on every dollar earned”.
“We’ve stepped in and stepped up with responsible and substantial help with the cost of living, and it’s why we’re rolling out the most ambitious reform package in a quarter of a century, cutting taxes for workers five different times in three ways, boosting super, making the tax system fairer, building more homes and helping first home buyers,” Treasurer Jim Chalmers said during the Labor conference.
Jim Chalmers spoke at the 50th National Labor Conference at the Adelaide Convention Centre. Picture: NewsWire / Brenton Edwards.
“That’s what delivering real change looks like: making a positive difference, not dismissing people’s anger and anxiety, addressing delivering real change and real reform in our economy.”
While Bunnings, Priceline, Aldi and JB Hi-fi pay workers under 18 superannuation regardless of the number of hours they worked, many major retailers don’t.
Coles, Woolworths, Kmart, McDonald’s and Target are some of the companies which would be impacted by the policy change.
Early in July, an unsuccessful motion introduced by Greens senator Barbara Pocock to prevent Mr Chalmers from using his ministerial discretionary powers to exclude companies from paying super to minors failed.
The current Superannuation Guarantee rate is set at 12 per cent, providing the opportunity for more than 500,000 teenagers to be paid super.
Senator Barbara Pocock introduced a motion earlier this month concerning Mr Chalmers ministerial powers. NCA NewsWire / Martin Ollman
The motion was opposed by Liberal and Labor senators including Maria Kovacic, Andrew Bragg, Minister Tim Ayres and NDIS Minister Jenny McAllister.
At the time, Senator Pocock said they had voted to “pump the profits of Coles, Woolies and Maccas”.
“Labor is the party of big corporations, not the party of workers,” she said.
“Young people shouldn’t be penalised for going to school or studying”.
“Labor can’t hide from teenage workers. The Greens won’t let this go.”
Around 93 per cent of people under the age of 18 work fewer than 30 hours per week, due to school and study commitments.