The employers in the building and construction sector must be aware of the relevance of superannuation (super) to their employees. Super funds are used to provide employees with time to access money they have saved and invested upon their retirement and in the case of constructions it is even more significant to manage their super because the industry is often irregular.
Details employers need to know to manage superannuation effectively
Why superannuation matters for construction workers
Superannuation is a savings fund given to workers to grow over time to enable them become economically independent upon their retirement. The construction workers find it hard to save to retire as there is job instability and the work is physically demanding. Employers contribute to a super fund and this helps to guarantee the future of its employees.
Key responsibilities for employers in construction
Being an employer in the building industry, it is important to know what you have to do in respect to superannuation. You have to adhere to the regulations of superannuation and make sure that funds of workers are handled properly. Here’s what you need to know:
Each eligible worker needs to be provided with a super fund funded by employers:
- Mandatory super contributions: The employer is required to make a minimum percentage payment (10.5 per cent at present) of the ordinary time earnings of a worker to his or her chosen super fund.
- When super contributions must be made: The frequency of the contributions should be quarterly. You should make sure that you pay on time or you will be sanctioned.
- Eligible workers: The majority of employees in the construction industry are able to make superannuation contributions, and this will include part time workers and casual workers.
Selecting the right super fund for construction workers
Employers should take into consideration some major factors when selecting a Super Fund for construction workers to make sure that their interests are addressed.
- Default fund options: Most employers have default funds among their employees.This can be an industry super fund such as BUSSQ, that offers reduced charges and good long term outcomes.
- Employee choice: The workers may select their super fund. Make sure the workers are informed of their right to choose a fund that best fits their objectives in retirement.
- Fees and investment options: The various super funds have different investment options and fee structures. As an employer, you are expected to assist the workers to learn of the various options at their disposal.
Benefits of a super fund for construction workers
Superannuation does not only offer retirement savings. It has various advantages that can assist employees in their professional life and upon their retirement.
Superannuation insurance benefits:
- Life insurance: Most of the super funds, including BUSSQ, provide life insurance cover, which benefits the family of workers in case of unforeseen circumstances.
- Income protection: This type of insurance is particularly beneficial to construction employees, since it could provide those workers with the income that is lost when they cannot work because of illness or accident.
Long term savings growth:
- Compounding growth: This means that the money contributed into super funds will grow by use of compounded returns, meaning that workers will have a large retirement nest egg.
- Tax benefits: The contributions to superannuation receive a reduced tax, which enables workers to contribute better towards their retirement.
How employers can help workers manage their super
Employers must actively help to make workers gain knowledge about their superannuation. Employers can support their workers in the construction industry using the following ways:
- Frequent communication: Preserve workers on their super options, and motivate them to examine the performance of their fund once in a while.
- Provide educational resources: Educate the workers to explain how their super fund operates and how they can contribute more and how they can monitor their super.
- Provide educational resources: It is imperative that worker superannuation information is current particularly when workers change jobs, or when they change their personal information.
Finally
Superannuation is one of the important elements of retirement planning particularly among construction workers. You can contribute to guaranteeing the future of your workers and contributing to their financial condition by offering the correct advice and choosing the most appropriate options in terms of super funds.