Superannuation Guide for Employers

The super guarantee in brief

As an employer, you must pay superannuation contributions — the super guarantee (SG) — for your eligible workers, calculated as a percentage of their ordinary time earnings. The rate is set by legislation and has been moving over recent years, so always confirm the current rate with the ATO rather than carrying last year's number in your head or, worse, in your payroll settings. Super is not a bonus or a negotiable extra: it's a legal obligation with one of the harshest penalty regimes in Australian tax.

Who you pay super for

The net is wider than "salaried staff":

• Employees — full-time, part-time and casual, generally regardless of how little they earn. The old minimum monthly earnings threshold was removed, so don't rely on it.
• Some contractors. If you pay a person mainly for their labour under a contract, they can be entitled to super even with an ABN and an invoice. This is one of the most commonly missed obligations in SME payrolls.
• Workers under 18 have their own eligibility conditions — check the ATO's current rules.

What counts as ordinary time earnings

SG is calculated on ordinary time earnings (OTE): broadly, payments for ordinary hours of work, including most loadings, commissions and shift allowances. Overtime for genuinely additional hours is generally excluded. The classifications are fiddly at the edges — the ATO publishes a detailed checklist of what's in and out, and your payroll software needs each pay item mapped correctly. A single mis-mapped allowance can quietly underpay super for years.

Choice of fund and stapled super

New starters get a standard choice form so they can nominate their own fund. If they don't choose, you can't simply default them into your fund straight away — you must first ask the ATO whether they have a stapled fund, an existing fund that follows the employee from job to job. Only if there's no choice and no stapled fund do contributions go to your nominated default fund. Skipping the stapled-fund check can mean contributions to the wrong fund and penalties, even though the money was paid.

Paying on time — and the shift to payday super

Historically super was payable quarterly, but the payday super reform aligns super payment with wage payment, so contributions must reach the employee's fund much sooner after each pay run. Check the ATO's current guidance on exactly what timing applies to you and how the transition works. Two practical points regardless of regime: the deadline is about when the fund receives the money, not when you send it, so clearing-house processing time matters; and "we always pay it eventually" is not compliance.

If you pay late: the Super Guarantee Charge

Miss a deadline — even by a day, even by accident — and you're technically liable for the Super Guarantee Charge (SGC). The SGC recalculates the shortfall on a broader earnings base, adds interest and an administration component, requires you to lodge SGC statements, and unlike ordinary super contributions is not tax-deductible. Directors can be made personally liable for unpaid super through director penalty notices. If you do miss a payment, act immediately: the ATO's processes are far kinder to employers who self-correct quickly than to those it finds.

Making it run without you

• Confirm the current SG rate and payment timing in your payroll software at the start of every financial year.
• Build the stapled-fund check into your onboarding checklist.
• Pay super with each pay run rather than batching it — it smooths cash flow and removes deadline risk.
• Reconcile payroll super against actual fund receipts, not just against what the software says was sent.

Super sits inside the broader payroll machine — see people and payroll for the full picture, and finance operations for the cash-flow side of never being surprised by an obligation. General guidance only, of course — the ATO and your adviser are the authorities on how the rules apply to your payroll.