Australian workers are one step closer to having their superannuation paid simultaneously occurring as their wages. Payday super laws have been introduced to parliament today, after being announced by the government more than two years ago.
Employers are currently legally required to pay super quarterly.But from July 1 next year, new payday super rules would require employers to pay employee’s super within seven days of their wages.
The move is designed to help tackle unpaid super, which the Super Members Council found cost 3.3 million Aussies $5.7 billion in super payments in the 2022-23 financial year. That’s an average of $1,730 each a year, which can add up to a loss of $30,000 in retirement.
Treasurer Jim Chalmers introduced the bill to parliament today, which will also update penalties and charges for late or missed payments.
“In a typical unpaid super case, for a 35-year-old, recovering their super leaves their retirement balance more than $30,000 better off in today’s dollars,” Chalmers saeid.
“While most employers do the right thing, some disreputable ones are exploiting their employees.”
The Super Members Council said the change was “long overdue” and has urged parliament to pass the laws promptly to meet the looming start date.
“The introduction of payday super legislation has been a long time coming, its time to get this done,” Super Members Council CEO Misha Schubert said.
“Payday super is a simple, fair and urgent reform to help ensure every dollar owed to workers makes it into their super account on time and in full. Millions of Australians cannot afford to wait.
“Payday super is also tipped to deliver an average of an extra $7,700 fo
payday Superannuation Changes: Businesses Prepare for July 2025 Implementation
Changes to superannuation payment schedules,requiring employers to pay superannuation on the same day as wages (“payday super”),are set to come into effect on July 1,2025. The new rules aim to improve retirement outcomes for employees, but businesses are preparing for the transition and potential challenges.
Currently, many employers are permitted to pay superannuation contributions quarterly. The shift to payday super will require more frequent payments, aligning them with regular wage cycles. This change was initially announced in the 2023-24 federal budget, providing a three-year implementation period for employers, super funds, and software providers. https://www.ato.gov.au/super/superannuation-changes-for-employers/
Some business owners are expressing concerns about the administrative burden and potential impact on cash flow. One business owner noted the changes may require adjustments to staffing levels, though they don’t anticipate reducing employee hours. “I don’t think this is going to hurt staff in that they’re going to get less hours. But it is indeed a consideration now, and I’ve spoken to them about it,” they said.
the Council of small Business Organisations of Australia (COSBOA) supports the principle of payday super but has advocated for a phased implementation. They argue that businesses need sufficient time to fully prepare their systems and processes before the stricter seven-day payment requirement is enforced.https://cosboa.org.au/
The Australian Taxation Office (ATO) provides resources and guidance for employers to help them prepare for the changes. These resources include data on updating payroll systems, reporting requirements, and key dates. https://www.ato.gov.au/super/superannuation-changes-for-employers/
Key takeaways:
* Implementation Date: July 1, 2025
* Change: Superannuation payments will be due on the same day as wages.
* Impact: Businesses need to update payroll systems and processes.
* Support: The ATO and COSBOA offer resources to assist with the transition.
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