Australia’s unpaid super gap: Workers miss $5 billion yearly as payday laws loom

The financial impact can be long lasting. Missing just $1,730 in super in a single year could leave a worker about $30,000 worse off by retirement due to lost compounding returns. 

The data shows the scale of the problem across regions and income groups. New South Wales recorded the highest underpayments at $8.1 billion over five years, followed by Victoria at $6.1 billion and Queensland at $4.7 billion. Workers in the Northern Territory were the worst affected annually, missing an average of $2,140, ahead of the ACT at $2,120 and Western Australia at $1,800. Lower income earners are particularly exposed, with one in two people earning under $25,000 missing out on super. 

Women also retire with 25 per cent less savings than men, according to the Association of Superannuation Funds of Australia.

“Unpaid super hits hardest where it hurts most - for women, younger workers and people on low incomes,” council chief executive Misha Schubert said. 

From 1 July, payday super laws will require employers to pay contributions within seven days of wages, with funds given three business days to process payments. 

The reform is expected to improve transparency and reduce underpayments, though businesses with tight cash flow may face added pressure. The tax office has signalled a softer compliance approach in the first year for employers who correct genuine mistakes quickly.