Businesses of all sizes are starting to catch onto the importance of encouraging and supporting the wealth building and wealth management of their employees, which is a huge win for Aussie workers.
That’s according to Jacinta Jones, Chief Customer Officer at Roll-it Super.
“Sadly, the choice of staff super is rarely given the time of day, despite it playing such a monumental role in employees’ lives,” Jones told HRD.
“While I agree that is not the role of HR departments to be monitoring and selecting super funds for their staff - default super is a minefield and there is no one fund that is in the best interest of every individual.”
Jones said the solution is in increasing transparency and competition, empowering employees to make their own super fund choices and helping them to abandon the worst super products en masse.
“HR has a lot of power here to make significant changes for the long-term benefit and prosperity of Australian workforces, and Aussie employees are ready,” added Jones.
“It’s time to truly empower and engage employees to make a tactical decision on where their super guarantee contributions are going and where their nest egg is growing.
“After all, only an individual can know their financial situation, risk appetite and what is right for them. Greater prosperity for all Australians is the goal!”
In particular, HR needs to take a more proactive interest in superannuation, according to Jones.
“Super is a big ticket business expense that sits within the staff payroll line item,” she said.
“Knowing employees are engaged in this part of their overall remuneration is important, as it can be very empowering when they fully appreciate this aspect of their salary package.”
Approximately 10% of an employee’s remuneration is made up of super guarantee contributions, paid by the employer.
Jones added that when staff “embrace, cradle and engage” with their super contributions, they know they are “building their long-term financial nest egg”.
“Sometimes, a simple, gentle reminder of an SMS to staff as super contributions are being added to their nest egg will get them engaged and checking their balances,” said Jones.
This type of employee engagement in super diminishes the expectation gap that sits between employees and employers when an employee doesn’t recognise their super contributions as part of their take home pay.
“By expectation gap, I mean when an employer sees the remuneration package of $66,000pa, but their employee only values the $60,000pa (less tax) that they take home,” said Jones.
“This type of mis-match can muddle the waters quickly between workers and employers, creating an ‘us and them’ culture, which is never good for business.”