If you own a business and have employees, a business superannuation scheme is good for your business because it:
- Encourages staff loyalty.
- Reduces recruitment costs.
- Enhances productivity and motivation.
Establishing a superannuation scheme in your workplace sends important and positive signals to current and future employees. This in turn may lead to more successful recruitment and higher retention rates, encouraging motivated people to both join and stay with your business. It may also give you the flexibility to bundle up salary packages better to suit your needs and your employees’ needs.
With a more stable workforce, your business benefits from the reduced costs of recruiting and retraining - and of course the flow-on effects of employing a solid team of people who feel valued for the contribution they make to your business. With enhanced employee-employer relationships in the workplace, productivity and staff motivation are likely to be enhanced.
A Business Superannuation scheme also allows you to set in place a valuable ‘vesting’ component that encourages employee loyalty – the longer your employees stay with you, the greater the proportion of your contributions they can qualify for.
It’s good for your employees because it:
- Provides enforced savings to meet their retirement goals
- Deductions are made from their pay
- Provides tax incentives for high earning employees.
- Insurance is available at a lower cost
A business superannuation plan makes it easy and convenient for your employees to save for their retirement, with regular contributions deducted straight from their pay. They simply choose the best investment portfolio for their circumstances and retirement goals and agree with you on the amount they will contribute to the plan.
A business superannuation plan can offer your high earning employees the tax benefits of ‘salary sacrifice’ (with your approval). If they earn over $60,000 a year, any employer contributions you make to their account are taxed at 33% rather than at the 39% they would normally pay – saving them 6 cents in every dollar they contribute.
Then there’s the added incentive of your contributions, which will boost your employees’ confidence in both the plan and the importance of saving for long-term goals. They will be confident in the knowledge that they are taking important steps towards a comfortable and financially secure retirement.
An employer may offer superannuation insurance as part of the group scheme at a lower cost than an employee could obtain as an individual. Life insurance, Total and Permanent Disablement insurance and Trauma insurance are available. Under a group scheme, acceptance is automatic regardless of pre-existing medical conditions, smoking status or gender.
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