New modelling shows the financial benefit of axing unfair super rules for under-18 workers: Rest

Rest, one of Australia’s largest profit-to-member superannuation funds, is strengthening calls for all Australian workers under-18 to earn super regardless of how many hours they work, with new modelling showing the change could add thousands of dollars to their retirement savings.

Modelling by the Super Members Council of Australia, released today, showed the average under-18 worker could see their super balance boosted by almost $10,000 (in today’s dollars) by the time they retire at age 67 if they receive super contributions regardless of how many hours they work.¹

Currently, workers under the age of 18 are only eligible for compulsory Superannuation Guarantee payments from their employer if they work more than 30 hours per week for that employer, although some employers already voluntarily pay this.

Rest Chief Executive Officer Vicki Doyle says the new modelling made it clear that superannuation should be universal for all under-18 workers.

“This law is simply unfair and needs to change. Every worker under the age of 18 deserves to earn super no matter how many hours they work,” says Ms Doyle.

“93% of workers under the age of 18 work less than 30 hours a week and are not eligible for compulsory super contributions.² They are potentially missing out on thousands of dollars in retirement.

“We represent over 1 million young members under the age of 30, many who work in part-time and casual roles. It’s essential that all young workers can have a fair start with super and can receive the benefit of compounding returns from day one of their working life.

“Simplifying who is eligible for super will also help make the overall experience of super easier for our members. A consistent approach to paying super on every dollar will help drive better engagement from a young age, which in turn supports better future outcomes.

“We also know an overwhelming majority of Rest members and Australians support this move.

“Research commissioned by Rest earlier this year showed that nearly all Rest members believe it’s important that superannuation applies to all working Australians regardless of how much they earn or how many hours they work.

“Our research has also shown that most Australians think this law is unfair, and it should be changed so that workers under the age of 18 earn superannuation regardless of how many hours they work.”

Ms Doyle adds it is important the change includes a consultation process and multi-year staged approach to implementation.

“While this change will make super fairer and financially benefit countless young workers, it is also likely to have an impact on employers, particularly small and medium businesses, who employ part-time or casual workers,” says Ms Doyle.

“A thorough consultation process to consider this impact is essential, as is working with employers on implementing this change.”

Research conducted for Rest by Redbridge Group in July 2024 found that 97% of Rest members think superannuation should apply to all working Australians regardless of how much they earn or how many hours they work. ³

Separate research conducted for Rest by CRNRSTONE in May 2024 found that 82% of Australians think the law should be changed so that young Australian workers under the age of 18 earn superannuation regardless of how many hours they work. 77% also think the rule is unfair.⁴