Old law costs teens $411 million a year in superannuation, study shows

Superannuation

Workers under 18 who work less than 30 hours a week for one employer do not currently get paid superannuation. (Unsplash)

In short:

A peak body says young Australian workers lose $411 million a year in superannuation because a law excludes under‑18s who work fewer than 30 hours a week.

The Super Members Council says the exclusion adds up to $115 million in unpaid superannuation in Victoria – the highest of any state.

What’s next?

The Greens are leading a federal push to change the law.

Thousands of teenage Victorian workers miss out on about $115 million in superannuation because a law excludes some under‑18s from guaranteed super, according to new modelling.

The peak body representing profit‑to‑member super funds, the Super Members Council, said under‑18s are excluded from guaranteed super unless they work more than 30 hours a week for one employer.

The council said its analysis found about 156,000 teen workers will miss an average of $735 in super in 2026‑27, adding up to $115 million across the state.

Misha Schubert from the Super Members Council says the law now discriminates against young people. (ABC News: Ian Cutmore)

Super Members Council chief executive Misha Schubert said that figure was the highest of any state in Australia.

“Teenage workers in Victoria are being denied a basic workplace right that 17 million other working Australians enjoy – and that’s just not fair,” she said.

“A young person who earns a wage should also be paid super.

“Yet this outdated and discriminatory law treats teen workers differently just because of their age and their hours.”

The Super Members Council says its analysis shows 156,000 young workers miss out on super because of the law. (ABC Gippsland: Bec Symons)

The Super Members Council found young workers in NSW would miss out on $105 million, part of a nationwide total of $411 million in missed super this financial year.

Its analysis found 91 percent of under‑18s worked fewer than 30 hours a week.

It said the average teenage part‑time worker could miss $2,500 in super contributions by age 18, which could grow to $11 000 by retirement.

The council is calling for the law to be scrapped and said it was “out of step with community expectations”.

“Many teenagers have their first jobs in retail, hospitality, care and community services. These are real jobs, with real wages, and they should come with real super,” Ms Schubert said.

“The earliest super contributions matter because they have the longest time to compound.”

Labor members vote to extend compulsory super payments

A push to reform the law is being led federally by the Greens, which introduced an amendment bill into parliament earlier this month.

The party also secured a Senate inquiry on the issue, which will report to parliament in November.

“For too long, Australia’s superannuation system has failed young workers. It’s time for young workers to be paid the super they deserve,” a Greens spokesperson said at the time.

“The continued exclusion of workers under 18 who work fewer than 30 hours per week is a clear case of legislated age‑based discrimination that no longer has any defensible policy rationale.”

Federal Treasurer Jim Chalmers has expressed support for reform of superannuation laws affecting under‑18s. (ABC News: Matt Roberts)

Federal Treasurer Jim Chalmers has previously expressed support for reform, saying it was an “important” issue, but has yet to make any legislative moves.

“We are always looking at ways to strengthen the superannuation system and make it deliver for more workers,” he said in June.

Delegates at Labor’s National Conference last month voted to include a policy to extend compulsory superannuation payments to under‑18s, regardless of how many hours they worked.

The Australian Chamber of Commerce and Industry said it was concerned by the push for reform, saying it would have “very serious consequences for the small business community and the broader business community”.

Old law costs teens $411 million a year in superannuation, study shows

Old law costs teens $411 million a year in superannuation, study shows

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