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SMEs face $1 billion super bill

A draft plan by the Australian Tax Office may see employers forced to include overtime, maternity and paternity leave into time earnings when calculating superannuation. The move could cost businesses $1 billion, according to estimates by the Australian Industry Group.

Small business opposition spokesperson Steve Ciobo says an employee on an average wage taking 12 weeks parental leave would cost an employer $1,239 more.

Ciobo says it could cripple small business and lead to the loss of thousands of jobs: “While some small businesses can choose to offer superannuation to overtime and paid parental leave, it should by no means be made compulsory.”

Law firms have weighed into the debate, calling the potential ruling a “significant departure” from the existing legislation and “a challenge” for employers to work out what overtime counts as their staff’s usual hours.

A spokesperson for the Department of Superannuation said the changes would affect less than five percent of businesses. The ATO expects the ruling to be resolved in April.

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Adeline Teoh

Adeline Teoh

Adeline Teoh is a journalist with more than a decade of publishing experience in the fields of business, education, travel, health, and project management. She has specialised in business since 2003.

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