http://www.smh.com.au/articles/2003/07/14/1058034944946.html

Backlash over missing super
By Anne Lampe
July 15 2003

Tougher action against employers who fail to pay compulsory super
contributions is being pushed by the Federal Opposition and the Australian
Manufacturing Workers Union.

The campaign follows the discovery of a $700,000 hole in employee super
contributions at supermarket trolley maker Metro Products, which had an
administrator appointed two weeks ago.

Now, it has been discovered that Metro's super contributions for 2002-03 -
representing 9 per cent of workers' pay - have not been paid, according to
the AMWU and shadow workplace relations minister Craig Emerson.

And there is nothing anyone can do to get them back. Unpaid super
contributions are not included in the General Employee Entitlements and
Redundancy Scheme (GEERS) which gives preference to workers' back pay,
unpaid holiday and long service leave ahead of other creditors.

But super contributions are not covered.

Until this year, employers were required to pay super contributions only at
the end of the financial year, and many employees whose super contributions
went unpaid did not find out until it was too late.

From this financial year, contributions must be paid quarterly. Mr Emerson
and Paul Bastion, the NSW State secretary of the AMWU, said they would like
to have employers pay contributions monthly.

Last year Labor introduced a bill into parliament to protect workers'
superannuation contributions in the event of corporate collapse, but it was
rejected by the Coalition Government.

Mr Bastion says in 2001-02 more than 6000 companies failed, many leaving
workers out of pocket.

Mr Bastion said the union was assured last April that super would be paid by
June. "That is why this union has been demanding a number of improvements in
corporate law reform.

"First and foremost we believe there should be a reverse onus in the act
[the Corporations Act] in relation to the eligibility of directors.

"We say that once a company goes into liquidation . . . the directors should
be automatically debarred from holding office unless they can demonstrate to
a court or to the appropriate authority that they have exercised their
fiduciary duty as directors in accordance with the law, and when they have
done that they can be opted back in."

Mr Bastion said he had previously referred a number of failed employers to
the Australian Securities and Investments Commission for action. "Our
experience to date is a 100 per cent lack of interest from ASIC in these
type of collapses.

"Their argument to us is that they don't have sufficient funds to chase them
all, so they stick to the sexy ones. It is not good enough. Either the
Government should give more money to enable ASIC to carry out the proper
prosecutions as a real deterrent to these directors or automatically debar
them and they must demonstrate their bona fides to get back in."

A spokeswoman for ASIC said it was rare to prosecute directors for insolvent
trading because it was hard to prove and that many failures resulted from
mismanagement, which was not a crime.

This story was found at:
http://www.smh.com.au/articles/2003/07/14/1058034944946.html