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A member asked over 8 years ago

Unauthorised Deducation of Pay for Superannuation

Hi,  approximately 18 months ago, I received a letter from my employer stating that the company could not incur the additional costs for the increase in superannuation, and thus, would just be deducted from my payslip. I never authorised the deduction.  Is this legal?

Workplace & Employment Income disputes WA AU
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Law Advisor Research Team
Law Advisor Research Team
Researchers at LawAdvisor
Hi there. In 2012, the Australian government introduced new laws designed to incrementally increase the minimum superannuation guarantee. This refers to the minimum amount of superannuation that must be contributed by your employer. These increases began on 1 July 2013 when the guarantee increased from 9% to 9.25%. On 1 July 2014, the guarantee further increased to 9.5% where it currently remains.
It sounds as if your employer responded to one of these increases in the superannuation guarantee by ‘deducting’ the additional contribution from your salary. You said this occurred without your permission.
Whether your employer can deduct the additional superannuation contribution from your salary depends on the wording of your employment contract. If your contract says that you are to be paid a salary plus the minimum superannuation guarantee, then your employer is obliged to pay the increased superannuation amount on top of your salary (i.e. they cannot deduct this additional amount from your salary).
However, if your employment contract says that you are to be paid a fixed total remuneration package, inclusive of superannuation, then your employer can legally reduce your salary to account for the increased superannuation guarantee. Your employer can only do this if the decreased salary does not fall below the requisite award, minimum wage threshold or otherwise breach your employment contract.

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Whether your employer has acted lawfully depends on the terms of your employment contract. You may want to consider speaking to a lawyer who can advise you on your legal rights and whether you have a legal claim under your employment contract or other employment laws. By pressing the “Take Action” button, LawAdvisor can help you search for experienced lawyers and obtain fee proposals for their services. Costs for legal advice and representation will vary between providers based on experience and the scope of services.

Answered over 8 years ago   Legal disclaimer

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