Teenage girls are missing out on superannuation from their part-time work, creating conditions for gender retirement income imbalances to continue.
The Super Members Council (SMC), in a statement released this morning, said outdated laws denied super to most workers aged under 18.
Under current rules, workers under 18 are only legally guaranteed super if they work more than 30 hours a week for one employer.
“The current age-based minimum-hours rule means most teenage workers, especially young women who are more likely to work part-time, are not yet paid super on their wages,” the Council said.
“Women currently retire with 25 percent less super than men, and the gap can start from their very first day at work.”
The SMC said teenage girls were more likely to work in retail and community service jobs and typically worked fewer hours than the current 30-hour super threshold for under-18s.
Teenage boys under 18 were more likely to work as tradesmen and labourers, where full-time hours and apprenticeships were common, giving them guaranteed super.
SMC CEO Misha Schubert called on the Federal Government to abolish the 30-hour threshold.
“Under-18 workers in Queensland will be short changed $104 million in retirement savings this year because of this outdated rule,” she said. “It’s time to fix it.”
“The sooner you get super, the more it’ll look after you. Missing out on super before 18 can cost some young people $11,000 by retirement.”
New SMC analysis showed 127,000 under-18 workers in Queensland would miss out on an average of $820 in super contributions this year. About 515,000 teenage workers nationally would be excluded from a combined $405 million.
The current super laws were created to prevent fees eroding low-balance super accounts.
However, the SMC argues that this reason no longer stacks up because of fee protections on small super balances.
A recent report by the Council found that axing the 30-hour threshold would help close the gender super gap.
The SMC describes itself as a “strong voice advocating for more than 12 million Australians who have over $1.6 trillion in retirement savings managed by profit-to-member superannuation funds”.
