The reforms will require employers to pay super contributions at the same time as salary and wages
Employers would be required to pay their employees' superannuation at the same time as their salary, under new legislation introduced to Federal Parliament.
Under the proposed changes, to start from 1 July 2026, employers would be required to ensure super contributions are received by an employee's fund within seven business days of payday or face a penalty through the superannuation guarantee charge. Currently employers pay superannuation contributions quarterly.
The government said the changes would also make it faster for the Australian Taxation Office (ATO) identify employers not making contributions,
Parliament urged to pass bill
Around 3.3 million Australians are missing out on $5.7 billion in unpaid super, according to the latest data from the Super Members Council.
SMC CEO Misha Schubert said the introduction of payday super legislation "has been a long time coming" in addressing the problem of unpaid super.
"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," Schubert said in a statement.
Unions also welcomed the move.
"Paying super on payday is a commonsense way to make it harder for dodgy employers to steal workers' super," said Joseph Mitchell, Assistant Secretary of the Australian Council of Trade Unions, in a statement.
"Payday Super is a long overdue reform. Unions urge the Parliament to urgently pass this legislation to ensure more of workers' money gets to workers."
Concerns for small business
CPA Australia, the country's largest accounting body, said the current quarterly payment system was "outdated and troublesome" but expressed concern about how the new regime would work in practice, particularly for small business.
"The new regime will be challenging for some big businesses, but small businesses will be particularly impacted by the change, all while dealing with ongoing challenges in the business environment including rising costs and increasing regulation," said Richard Webb, CPA Australia's Superannuation Lead, in a statement.
"The start date of July 2026 remains a major challenge. A period of chaos could ensue as businesses try to fulfil their compliance obligations while trying to balance their books."
The Australian Chamber of Commerce and Industry (ACCI), the largest business network in Australia, said it supports the concept of payday super in principle but many small businesses will face "considerable adjustment" because of the legislation.
"The more frequent payments will add extra costs to running a business and tie up small business owners by spending more time on administration," said ACCI chief executive officer Andrew McKellar in a statement.
McKellar added that the closure of the ATO's Small Business Superannuation Clearing House (SBSCH) scheme, which enables businesses to pay super to all employees through a single payment, in July 2026 will further impose burdens on SMBs.
Its closure means small businesses will need to migrate to new payroll software for super payments that integrate with new payment platforms, according to McKellar.
"These modules are still being developed by the accounting software providers, so small businesses have little time to integrate the new software into their systems," he added.
Annoncing the planned changes, the government said the ATO also plans to consult on its approach to compliance for the 12 months after the change starts.
"The ATO's approach will differentiate between low and high‑risk employers," the government said.
"This approach will mean that employers who are making the effort to pay contributions in line with each pay cycle will fall into the low‑risk category."
Employment Hero CEO Ben Thompson said the Payday Super bill was welcome.
"Employment Hero strongly supports the intention of the reform and has consistently advocated for practical implementation that recognises the realities of how small and medium businesses operate," Thompson said in a statement.
"Our focus remains on supporting hundreds of thousands of small and medium-sized businesses (SMBs) through these changes with industry-leading technology."
