New Zealand. KiwiSavers miss out on $270 million – employers may be to blame
More than half a million KiwiSaver members left $270 million of government contributions unclaimed last year, and employers may be partly to blame.
David Boyle, Education Manager at the Commission for Financial Capability, says some employers may not be fulfilling their legal obligation to pay the required 3% employer contribution to KiwiSaver on top of their employees’ wages.
A CFFC survey in May of 500 companies showed only 55% of employers paid the 3% on top of wages, 10% paid it out of their employees’ salaries, 20% were ‘not sure’, 10% said ‘it varied’ and 5% offered other pension schemes. Boyle says in many cases employers bundle the 3% into an employee’s wages, and the employee must choose whether to have it sent to their KiwiSaver account. By law, employers can only include KiwiSaver contributions in salary packages if they have negotiated this with the employee “in good faith”.
Read More: Scoop
