One in four Australian workers underpaid super, ATO recovers only 15 per cent

Brisbane dental clinic workers still waiting 18 months after ATO ruled in their favour

By LineZotpaper

Published21 October 2026

Read Time3 min

Sources2 outlets

One in four Australian workers are being underpaid superannuation by their employers, costing about $6 billion each year, with only about 15 per cent ever recovered by the Australian Taxation Office, independent reports show. Two Brisbane oral health therapists who won complaints against their employer 18 months ago say they still have not seen a cent returned to their super funds.

The figures come as no surprise to Pauline Devin and Angela Noack, who were underpaid around $5,000 and $3,000 respectively in super while working at a Brisbane dental clinic two years ago. The oral health therapists filed separate complaints with the Australian Taxation Office (ATO) early last year, and the regulator found in their favour in April. But 18 months later, neither has received any money or further information from the ATO.

"All I ever used to get was, 'No, we can't give you any information because it's an invasion of privacy'," Ms Devin said. Ms Noack said she had concluded she probably would never get her super paid, adding that the ATO did not "seem to be really going in to bat" for her.

The ATO declined an interview request but said in a statement it was "serious about ensuring employers comply with their super obligations" and dedicates significant resources to education, audits and debt recovery. It also said "tax secrecy and privacy laws limit what the ATO can disclose to employees".

Industry Fund Services, a private firm that recovers unpaid super on behalf of three super funds, takes a more proactive approach. Its executive manager of super recoveries, Natalie Lister, said the firm uses digital communications and phone calls to engage employers, with only about 10 per cent of cases escalated to legal threats. The firm uses data from its fund clients to contact employers before employees need to flag discrepancies.

On July 1 this year, the ATO introduced payday super, requiring employers to pay super at the same time as wages. Super Members Council chief executive Misha Schubert called the reform a "game-changer" but said it needed to be "backed in action by the tax office taking more proactive action". She noted that on average, only 15 per cent of unpaid super is recovered, a figure backed by a 2022 Australian National Audit Office report.

Ms Devin and Ms Noack called for more transparency and tougher penalties. Ms Schubert said the federal government should extend the Fair Entitlements Guarantee to cover unpaid super when employers are insolvent. A government spokesperson said the scheme's recovery program had been strengthened since July 2024 to allow liquidators to pursue unpaid super in eligible insolvencies.

Analysis

Why This Matters

This affects one in four Australian workers, particularly in low-paid jobs, and undermines retirement savings.
The low recovery rate (15%) highlights a systemic failure in enforcement despite recent reforms.
The cases of Ms Devin and Ms Noack show the personal toll on workers who face long waits and lack of information.

Background

Superannuation is a compulsory employer contribution in Australia, currently 11.5% of wages, designed to fund retirement. The ATO is responsible for enforcing payment. Despite data showing 92% of contributions by dollar value are paid voluntarily, one in four workers are underpaid. The new 'payday super' requirement, introduced in July 2026, gives the ATO real-time visibility of payments. The Australian National Audit Office reported in 2022 that only about 15% of unpaid super is recovered.

Key Perspectives

Workers (Ms Devin and Ms Noack): Feel helpless and frustrated by the ATO's lack of communication and enforcement. They want greater transparency and tougher penalties on non-compliant employers. ATO: Says it is serious about compliance but is limited by tax secrecy laws. Points to its use of data sources and the fact that most contributions are paid voluntarily. Super Members Council (Misha Schubert): Calls the recovery rate "heartbreaking and completely unacceptable". Welcomes payday super but wants proactive ATO action and an extension of the Fair Entitlements Guarantee to cover unpaid super. Industry Fund Services (Natalie Lister): Demonstrates that a private approach using data and early contact can recover super more effectively than the ATO's later interventions.

What to Watch

ATO recovery rates over the next year to see if payday super improves enforcement.
Possible legislative change to include super in the Fair Entitlements Guarantee for insolvent employers.
The impact of the ATO's real-time visibility under payday super on the number of underpayment complaints.

Sources

One in four workers underpaid super, with only 15pc recovered by ATO · Just In
One in four workers underpaid super, with only 15pc recovered by ATO · Latest business news

Checked

3 claims in this story checked against 1 source: 0 supported.

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Not in the sourcesIndustry Fund Services is a private firm.Just In
Partly supportedThe Fair Entitlements Guarantee should cover unpaid super when employers are insolvent.Just In: “Ms Schubert said where the ATO cannot recover super owed to workers because, for example, an employer is insolvent, the federal government should improve the safety net offered to employees via the Fair Entitlements Guarantee.”
Partly supportedThe government strengthened the scheme’s recovery program to let liquidators pursue unpaid super in eligible insolvencies.Just In: “A spokesperson for the federal government said since July, 2024, it had “strengthened” the scheme's recovery program, which now allows liquidators funded by the government to “actively pursue unpaid superannuation guarantee charge amounts in eligible insolvencies and improve recovery outcomes”.”