Here's a fun fact, if you resign from a job and have annual leave outstanding you do not get Superannuation paid on the leave as it is called termination pay. Lesson being, don't give notice, just take leave and you'll get it. 12 weeks leave no super.
I had the Super guarantee folks look into this and confirmed it…… Not fair.
you do not get Superannuation paid on the leave
of course not. why would you?
Because you would if you did a d!ck move and just took all your leave and then resigned. Basically just encourages employees to do just that. In fact I know someone who is doing exactly that right now!
when you resign, you no longer earn salary and wages.
Super is paid from your salary and wages. You need to work for it or be employed.
It is not from other payments such as termination.
I know that. That is the technical reason. But practically it makes little sense as it rewards employees who keep their employer in the dark about their intentions, and disadvantages those who are straight-forward about their resignation.
That is the technical reason.
Not technical at all.
You will not be employed for the 12 weeks pay you are getting after you resigned, so no super applies.
@jv: Correct. Regardless of what you do during your notice period (work or take annual leave) you will be paid super during that period.
Financially speaking, I believe it's better to work through the notice period, get paid for it, get super paid, and when employment finishes get paid out the annual leave. Sure you will get taxed more, but you should end up making more money this way than if annual leave was used during the notice period.
If I took the leave I would get paid the Super on my leave, because I left before taking it should not mean I dont get paid.
What's more: you would be accumulating annual leave while on annual leave as well and would get that paid out
If I took the leave I would get paid the Super on my leave
If you were employed during that period, then yes.
You only accumulate super during your employment.
Only accumulate compulsory super payments during your employment. There is no rule they can't give you extra.
There is no rule they can't give you extra.
Yeah, they can keep paying you for the rest of your life if they want to…
No law against that…
Maybe I should ask the newsagent I delivered papers for decades ago to pay my super since I left.
There was at least one post about this last year - eg, https://www.ozbargain.com.au/node/694112
Unless you need to give notice straightaway (eg, to start a new job), best to take all the annual leave and LSL to get the super entitlements. Then give notice.
I thought this was common knowledge.
Obviously not…
A bit like news articles warning of particular scams then seeing a report a few months later of someone falling for that scam. Interesting to see as to when does something need to be publicised enough for it to be common knowledge? Even then, there might still be a minority that would be unaware.
I wouldn't expect people to just have those rules in their memory (I mean, how often do people resign from jobs anyway, it shouldn't come up a lot) - it's more "i'm about to make a major job decision, and I won't look up any tax/super/leave rules before I do so"
Kind of like booking a trip and flying to a country and not researching entry/visa etc requirements as part of the process.
No one plans to fail but plenty of people fail to plan.
@CrowReally: I agree with your comments. I hadn't thought about it until I read last year's post. When I left my previous jobs I just cashed out my annual leave without thinking. Also I had another job lined up to start straightaway, which had a higher salary that offset the lost super. Also, back then, my super was pretty small.
How much are you out of pocket?
About $2k, but stunned they are allowed to do this….
You are not entitled to it if you are not employed for the 12 weeks.
It's not your money.
Why is it not fair? You are resigning, presumably to take up alternative employment where the superannuation will be paid on that income.
When did "I don't agree with something" become synonymous with "it's not fair"?
It just isn't fair.
For a country with more workplace protections than many others, it is unfair when an employer decides to pay their employee correctly and as per legislation. Even more so that this is likely the configuration of their payroll software and they haven't looked out for this one particular individual and decided to pay his super on term AL.
It just isn't fair.
Of course it is fair.
Your employer pays super for you whilst you are employed.
When you no longer work for them, there is no requirement for them to keep paying your super.
Lesson being, don't give notice, just take leave and you'll get it. 12 weeks leave no super.
No the lesson is to always ask ozbargsin before you take a poopie
before you take a poopie
Are you referring to the Number 2 post where there was some debate?: https://www.ozbargain.com.au/node/714073
How many workplaces allow you to just take 12 weeks leave with minimal notice?
How many places let you accrue 12 weeks leave?
My employer is always on our backs to take our accrued leave every year.
At my last place, i gave notice, then used up my annual leave
Did you get Super?
Of course. I was on an all inclusive package so no matter what I would be paid the super component.
Is it illegal to take 8 weeks annual leave and then put in 4 weeks notice with 4 weeks to go?
No, but it is a dick move.
Is it a dick move not to pay super on the annual leave when an employee leaves?
That's up to you to decide.
It's the norm in every single company in the country. It would be an effort at some companies to actually try pay super on it because terminations are calculated automatically (at least any big company around).
So they're all dicks.
@freefall101: It's the norm because employees get jerked around with their super, ie up to 3 months delay, etc. I find the government allowing 3 months and not paying super on AL to be dicks about it too.
For the people above talking about d!ck moves for taking leave instead of just resigning. Remember, YOUR EMPLOYER does not give a single sh!t about you and will happily fire you in a heartbeat if it serves them.
I'm surprised you were allowed to accrue twelve weeks leave. This indicates you weren't taking much of your entitlement at all.
This is bad for both parties. It's a growing liability for the employer (plus, staff who never take leave tend to become overly relied upon and avoid knowledge share) and you really should be taking regular leave for your wellbeing.
I wish i had know this two weeks ago!!! Damn.
Just wait until the same OzBargainer is running a business. Businesses aren't setup to be run as a family so of course if you're not helping them they're gonna try and get rid of you. Anyone who disagrees is just deluded or naive.
Fairness not enshrined in law is just charity and goodwill and you're leaving anyway so why should they give you anything more?
What if your contract specifies a salary inclusive of Super? Wouldn't they be obliged to pay it due to the contract, regardless of super rules. ie. if they pay less super they need to up the pay to make the specified total?
This isn't news, but I guess there will always be people who weren't aware. I always try to use up my leave before leaving, despite that not happening often.
To add if your workplace entitles annual leave loading. It is another incentive to use up your leave before resigning.
scenario 1 - leave with 12 weeks pay no super paid, start new job, and get double pay for 12 weeks (pay f tonne of tax maybe)
scenario 2 - take 12 weeks leave get the s.g. then come back quit do 4 weeks notice start new job.
if you were planning on never working again or taking huge break, i'd go scenario 2 else scenario 1
under scenario 2 you would accrue another weeks leave, come back blaze through sickies and take another week. quit
back in the old days I sacraficed an entire fortnights pay to super and my company didn't pay the SG at all (i.e paid it on $0). i complained, they said its legal, i said its theft and pathetic, i bludged for a month then quit.
Yep - take the leave, don't get it paid out. Good tip, OP