New law requires employers to pay super with each payroll starting July 1, 2026
At People2.0, keeping our partners informed about significant legislative changes is essential. The Australian Parliament has passed the Treasury Laws Amendment (Payday Superannuation) Act 2025, changing how employers must handle superannuation contributions starting July 1, 2026.
Understanding the Legislation
The new payday superannuation law requires all Australian employers to pay superannuation guarantee (SG) contributions simultaneously with employee salary and wages. This ends the current quarterly payment system that has been in place for decades.
The reform includes the introduction of a new term “qualifying earnings”, used to describe the types of payments employers must use when calculating SG under Payday Super. From 1 July 2026, all employers will calculate both SG and the super guarantee charge (SGC) based on qualifying earnings, which generally include ordinary time earnings, commissions, salary sacrifice amounts that would otherwise count as qualifying earnings, and payments to contractors who are considered employees for SG purposes. For many employers, this will not change the amount of SG they currently pay.
Key Provisions
With some exceptions, the legislation requires:
- Payday timing: Super contributions must be paid with each salary or wage payment
- Seven-day requirement: Contributions must reach employee super funds within seven business days of payday
- Penalties: Employers failing to meet these requirements will be liable for the Superannuation Guarantee Charge
You can read more about these changes here.
Government Objectives
The Australian government designed this reform to address the estimated $5.7 – 6.25 billion in unpaid super from the most recent financial year. The change particularly benefits vulnerable workers and women, who are disproportionately affected by unpaid superannuation. According to government estimates, an average 25-year-old worker will gain approximately $6,000 more in retirement savings through earlier contributions and compounding returns.
What It Means for You
This shift from quarterly to payday super represents a significant change in payroll and compliance processes. Every employer in Australia will need to adjust their payment schedules, update their systems, and ensure they can meet the seven-day deposit requirement.
For staffing agencies and businesses with contingent workers, coordination becomes even more critical to ensure all worker super contributions meet the new timing requirements.
ATO Compliance Approach
The ATO plans to differentiate between low-risk employers who are making genuine efforts to comply and high-risk employers who aren’t attempting to meet the new requirements.
Next Steps
With implementation on the near horizon, businesses should begin reviewing their current super payment processes and considering the operational changes needed. Key areas to assess include:
- Current payroll and super payment schedules
- System capabilities for processing super with each pay run
- Cash flow implications of more frequent super payments
- Communication with super funds about processing timelines
People2.0’s Support
People2.0 is actively reviewing this legislation and preparing for the July 2026 implementation. As we make super contributions on behalf of workers and contractors hired to our clients, ensuring a smooth transition to payday super requirements is our priority. We’ll be reaching out to our partners with specific guidance and support as we approach the implementation date.
Navigating Compliance Together
This legislative change marks a significant shift in Australian superannuation administration. People2.0 remains committed to helping our partners navigate these changes while maintaining full compliance. We’ll continue monitoring developments and providing updates as the implementation date approaches.
For additional information, see these resources:
Ready to simplify your workforce compliance in Australia? Contact People2.0 to learn how we can support your operations.
Disclaimer: This update provides general information about legislative changes and does not constitute legal advice. The information is current as of December 2025. For advice specific to your situation, please consult with a qualified legal or tax professional. While People2.0 strives to provide accurate information, we recommend reviewing official government sources and seeking professional guidance for compliance matters.
