From 1 July 2022, employers will need to pay super for employees who earn less than $450 per month provided they meet certain eligibility requirements,
In addition, employers will also need to pay super for employees under 18 years old who work more than 30 hours a week.
The $450-per-month threshold for super guarantee was abolished in legislation passed through Parliament in February. This change expands super guarantee eligibility so that employees can receive super regardless of how much they earn. Employees who are under 18 will be eligible for super if they work more than 30 hours in a week, regardless of how much they’re paid.
A further change to the superannuation guarantee contributions is an increase by 0.5 percentage points each year until it hits 12% in 2025. The contribution will hit 10.5% of a worker’s ordinary time earnings from July 2022, up from the current 10%.
As we move closer to 1 July 2022, we recommend employers check their payroll and accounting systems have been updated to correctly calculate employees’ super guarantee payments. Software providers may be able to assist with further information on how and when they will implement changes to reflect the new requirements.
We also would like to stress the importance of ensuring that all the normal indicators of an employment relationship exist when paying wages to associates. In addition to employment agreements, this includes keeping time sheets of actual work performed and paying an arm’s length remuneration. If you need assistance setting up payroll or pay templates for employees please don’t hesitate to get in touch.
Employers can find further information on the new requirements at Super for Employers