The way superannuation is paid in Australia is set to change from next week under a new reform known as payday super. From July 1, employers will be required to pay their employees' super contributions at the same time as their wages, rather than once every three months as many currently do. The change marks one of the more significant shifts to the retirement savings system in years and has already drawn a mixed response from businesses across the country.
A large number of businesses already pay super alongside each pay cycle, but small businesses in particular have tended to make use of the three month window allowed under the current rules. From next week that quarterly option will no longer be permitted, meaning super contributions will land in workers' accounts at around the same time as their salaries, instead of being held back and paid in larger lumps every few months.
According to the report, the reform is aimed squarely at cracking down on unpaid superannuation and late contributions. In some cases, the practice has effectively amounted to wage theft, with certain businesses using the capital from unpaid super to prop up their own operations. By forcing more frequent payments, the government hopes to close off that gap and make it far harder for contributions to quietly fall behind.
Business reporter Adelaide Miller said that while a payslip might appear to show that super is being contributed, the reality for many workers has been very different. She said she had spoken to numerous employees who, at various points in their careers, went months and sometimes even years without their superannuation actually being paid into their accounts despite what their pay records suggested.
The scale of the problem is significant. The Australian Taxation Office has said that each year about 6.2 billion dollars is lost in superannuation, and that in many cases that money is never recovered for the employees who were owed it. Officials argue that requiring smaller, more frequent payments will help keep businesses on track with their obligations and ensure that workers ultimately receive the money they are entitled to.
The reform has sparked a mixed reaction among employers as the July 1 start date approaches. According to the report, many businesses already pay super each pay cycle and will see little change, while it is small businesses in particular, the ones that have relied on the quarterly window, that will have to adjust their payment routines once the new rules take effect. The shift reflects the government's push to ensure superannuation reaches workers reliably rather than being paid in delayed lump sums.