The Gig Economy Means Australians Are Missing Out On Super

With the rise of the gig economy, powered by apps like Uber and Deliveroo, thousands of Australians could be missing out on super payments.

Because these apps classify their workers as independent contractors, they argue  they aren’t required to pay the super guarantee. Add to this the increasing numbers of people working multiple part time jobs, and even if you earn as much as a full-time employee, you could be receiving no or very little super.

The superannuation guarantee requires all employers to pay their staff 9.5% of their wage to their designated super fund. However, if an employee earns less than $450 a month there is no requirement to pay out super. The same is true for self-employed contractors, which many apps, like Uber, claim all their drivers are.

100,000 Aussies missing out

As a result of this, around 100,000 Australians are missing out on super payments they would otherwise receive, according to a recent study. Even people working for traditional employers can be missing out if they work multiple jobs but earn less than $450 from each a month. While people working these new types of jobs are often young and may be able to earn super later in life, the savings they are missing out on now could easily cost them tens of thousands of dollars when they retire.

Thankfully, while the legislation may not yet adequately cover the changing nature of employment, people are beginning to take notice. The federal Senate has already conducted an inquiry into the issue and a new super fund specifically designed to cover gig workers is gearing up to launch this year. The classification of Uber drivers also looks set to change, with the UK courts ruling that drivers where Uber’s employees and therefore entitled to a minimum wage, leave and sick days. Uber is appealing the decision, but it will likely influence policy makers here.

How can I boost my super while doing gig work?

Meanwhile, if you’re working in the gig economy, there are a few things you can do to bolster your super now.

  • Talk to your employer about salary sacrificing – putting some of the money that would otherwise be your wages into your super fund
  • Make your own super contributions – you can even make it tax deductible if you are self employed
  • Make sure that your super fund has low fees
  • Make sure that your super account is all in one place so you aren’t doubling up on fees
  • Check to see if you’re eligible for government co-contributions – you can earn up to $500 a year if you make less than $51,813 per annum
  • Ensure your super is making the right investments for you
  • If you have a spouse or partner making more than you, they can contribute to your super on your behalf

Compare Superannuation with Canstar

 

The following table contains details regarding superannuation funds rated by Canstar. This table has been sorted by three-year average annual performance (highest to lowest).

Please note the performance information shown in the table is for the investment option used by Canstar in rating of the superannuation product.

Performance is based on the investment option considered in the 2016 Superannuation Star Ratings, which is the option with 60-80% in growth assets; where multiple options satisfy this criteria, the option with 60-80% in growth assets with the greatest funds under management is selected.

Compare Superannuation

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