What does the access-to-super debate mean for HR?

As political parties offer counter superannuation access policies, employers are already dealing with momentous compliance changes that have only just taken effect – but experts say there is no cause for alarm.

With Pauline Hanson’s One Nation party and the Liberal Party campaigning for weakened superannuation preservation policies that would allow easier and faster access to retirement savings, HR Leader spoke to employment lawyers to examine the next steps – if any – employers should take.

Patrick Will of Liquid Employment Lawyers explained that HR need not make significant administrative or strategic changes at this early stage of the proposals, but should be aware of any future operational needs from possible legislation that could also function in the present.

“While the payroll impact may be minimal, the operational challenge for HR professionals lies in managing the human element of these proposals,” he said.

“HR must establish clear communication channels to address questions like ‘How do I get my 3 per cent pay boost?’ from working-class employees targeted by these proposals, explicitly directing all such inquiries to their respective super funds.”

In this way, he said the bulk of any overhaul would likely rest with superannuation funds and financial institutions, and that both proposals would not eradicate the standard 12 per cent Superannuation Guarantee.

However, Will also said “HR leaders may consider proactively establishing educational and protective frameworks to shield vulnerable workers from coercion or financial abuse”, such as from partners seeking a forced cash-out.

“If superannuation begins to be viewed as an immediate-access slush fund, HR must adapt talent acquisition strategies,” he said.

“Attracting top talent will require restructuring remuneration packages to emphasise direct, immediate financial support rather than relying solely on super-heavy benefits.”

Will warned that the implementation of either proposed superannuation access system could force higher inflation, which, in turn, would lead to higher interest rates and complicate the running of a business and debt settlement.

In the same vein, he noted that businesses must sustain employee opt-in anonymity to avoid privacy complications and unnecessary tracking burdens.

Broadly speaking, Will urged employers to prioritise current compliance requirements, especially that of the Payday Super reforms.

According to Swaab employment lawyer Michael Byrnes, the debate offers insight into the pressures employees are dealing with and should motivate employers to consider whether the workplace mitigates or worsens these pressures.

With cost-of-living and economic stressors the core factor for both the One Nation and Liberal Party proposals, Byrnes said: “Employers may want to reflect upon this in terms of the extra benefits they provide to employees and tailor such benefits towards assisting with essential and basic needs rather than having a pure lifestyle or aspirational orientation.”

“It might also inform the approach of employers in offering overtime or additional work if it’s available. Decisions to accept, stay in, or leave a job by employees could be more economically driven than in times of prosperity.”

Byrnes also acknowledged that employers would be responsible for certain administrative changes should one of the proposals make it to legislation, including the provision of evidence to superannuation funds about employment status, remuneration and entitlements, additional hours requests, and the confirmation of employment termination.

He also warned of possible implications on the workforce itself, which the employer would be liable to address.

“If the effect of these proposals is, as asserted by critics of them, a depletion of superannuation funds, this might lead to older employees wanting or needing to remain in the workforce longer to deter reliance on a diminished superannuation balance,” he said.

“The policy objective of compulsory superannuation, to provide sufficient funds for employees to retire in some degree of comfort without reliance on the pension, could be compromised.”

Both the One Nation and Liberal Party’s superannuation offerings have been divisive, to say the least, with union and industry bodies generally calling the proposals an ideological attack on the system and a fast-fix to a much bigger issue.

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