Payday Super Legislation Introduced to Parliament, Set for July 2025
Australian workers are a step closer to receiving superannuation payments at the same time as their wages, as new legislation requiring payday super was introduced to parliament today.
Currently, employers are legally obligated to pay superannuation quarterly, but the new rules, effective July 1, 2025, will mandate payments within seven days of wages being paid. This change aims to address the significant issue of unpaid super, which the Super Members Council estimates cost 3.3 million Australians $5.7 billion in the 2022-23 financial year – an average of $1,730 per person annually, potentially totaling $30,000 lost by retirement.
Treasurer Jim Chalmers introduced the bill, which also updates penalties for late or missed payments, stating, “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.” He further emphasized that the legislation targets “some disreputable ones [employers] who are exploiting their employees.” The Super Members Council CEO, Misha Schubert, called the change “long overdue,” adding that “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.” For more information on superannuation, visit the Australian Taxation Office website.
While the principle of payday super is broadly supported, some business owners have expressed concerns about the impact on cash flow and the risk of penalties. Daniel McGowan, owner of Lucky Cat Cafe in Ipswich, noted the change would “add another layer of stress,” particularly for small businesses already managing rising costs. The Council of Small Business Organisations of Australia has advocated for a phased implementation. This reform is expected to boost retirement savings for millions of Australians, particularly those in lower-income brackets.
Parliament is now urged to pass the legislation promptly to ensure businesses and super funds can prepare for the July 1, 2025 start date.
