Musicians have finally been told, after 34 years, how to get their superannuation – get the band manager to collect it! What’s the scam?
The Tax Office spent July telling our FOI request it had limited documents. On Friday it published the answer, and it makes the person who collects the money at the end of the night responsible for everybody else’s super.
On Friday the Australian Taxation Office rebuilt its guidance on paying superannuation to performers. The contents list went from six entries to ten. Eight worked examples became fourteen. The opening sentence picked up a word it did not have in June: “musician”.
Three decades unpaid. 82% of musicians have never seen a cent of their super
The rule itself is thirty-four years old. Subsection 12(8) of the Superannuation Guarantee (Administration) Act 1992 makes anyone paid to perform music an employee “of the person liable to make the payment”. Since 1 July 1992. What was missing was any published example of
how a pub gig actually works.
Example 12 supplies it. The Old Oak Inn pays Sophie $900 under a verbal contract. Sophie asks Ryan and Amelia to play with her and agrees to pay them $200 each. The inn, in the ATO’s words, “is not aware that Ryan and Amelia will be performing with Sophie”.
So the inn owes super on the whole $900, all of it into Sophie’s fund. Sophie then owes super into Ryan’s and Amelia’s funds when she pays them, and it is on her to negotiate whether the $200 includes it.
Do it the other way, as in Example 10, and the pub pays a $980 gig fee to Neisha as the group’s agent, having been told she is acting for three people. The pub pays the super, $45 for Neisha and $30 each for Fatima and Mohammed, into three separate funds. Same three musicians, same room.
The difference is whether the venue was told, and whether the band leader had authority to act for the others.
What we asked, and when
MWM lodged a Freedom of Information request with the ATO on 13 July, seeking its internal analysis of what Payday Super does to performers.
The reply came on 29 July. “I have ascertained that there is limited information/documents to provide in response to your request,” the Tax Office wrote. It offered an interview instead, covering what it is doing in the super guarantee space and, in its words, “the updates being made to online materials for taxpayers”. The condition was that we withdraw the request, by close of business on 3 August.
We declined. On 6 August the ATO advised that two of the three business lines asked to search held no documents in scope. The decision is due on 11 September.
On 28 August the updates appeared.
Our first story reported that the ATO’s examples covered every way of hiring a band except the one everybody uses. Our second reported that no agency would say what analysis had been done before the law passed.
Somewhere in there, the updates were being made.
Sounds of Silence: a month into Payday Super, no answer on super for creatives
Michael West established Michael West Media in 2016 to focus on journalism of high public interest, particularly the rising power of corporations over democracy. West was formerly a journalist and editor with Fairfax newspapers, a columnist for News Corp and even, once, a stockbroker.
