Superannuation
As casual workers, students are entitled to superannuation under certain conditions. Many students aren't aware of their entitlements and may seek their teacher's advice.
Superannuation makes up an important part of remuneration. Students may not be certain how this works in relation to their pay.
What is superannuation?
Superannuation is a way of saving money to support yourself after you have retired from work. It is money your employer is legally required to deposit into a superannuation fund. This grows during your working life and earns interest, so you have money available to you when you reach official retirement age.
The law requires employers to pay 9% in superannuation to all employees, including students who:
- earn at least $450 per month; and
- If aged below 18, work at least 30 hours a week.
That 9% does not come from take-home wage, but is in addition to it. Some awards and agreements have Superannuation clauses written in to them which mean that even if a student doesn't meet these criteria, superannuation contributions will be made by an employer.
If they meet these criteria, or are entitled through their award or agreement to superannuation, they need to ensure their employer is making appropriate contributions to a superannuation fund. The student is probably entitled to choose the fund they will belong to, and their employer will give them a 'Standard Choice form'.
An employee doesn't have to choose. If they don't, the employer will choose for them. However, this could make it hard to keep track of when leaving that job and starting another. It is best to compare the costs and benefits of different funds to make sure they are getting the best deal.
Alert students to remember to keep any information relating to their superannuation account so they know where to find it as they move through the workforce. The Australian Securities and Investments Commission (ASIC) offers a lot of advice about choosing a Super fund, changing funds, and help with comparing funds.
Click here to visit the ASIC website section on Superannuation