Most Australians are aware that their employers are legally obligated to make contributions to their superannuation on their behalf. The Super Guarantee (SG) is the minimum percentage of an employee’s earnings that Australian employers must pay into a compliant super fund, presently set at 12% of ordinary time earnings.
At present, these contributions must be paid quarterly and do not need to align with the frequency that someone is actually paid (i.e. weekly, fortnightly or monthly).
The issue with this policy is that it can delay super contributions being invested, hence reducing the power of compounding investment returns. It can also make it challenging for employees to determine whether they have been paid the correct contribution.
In early November 2025, the Australian Government passed new legislation to require employers to pay their employees’ superannuation at the same time as their salary and wages. The Payday Super legislation will require employers to deposit their employees’ superannuation into accounts within seven business days of payday. The changes come into effect on 1 July 2026.
The Government estimates that for the average 25-year-old worker’s retirement balance, this simple change is the equivalent of receiving an extra $6,000 in today’s dollars.
If a worker is missing out on their super, the impact is even more significant. 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. While most employers do the right thing, the Australian Taxation Office estimates $6.25 billion worth of super went unpaid in the most recent financial year data.
At Alman Partners, we think every employee should welcome this small but important change. Super paid with each pay cycle means money hits accounts earlier, allowing more time for investment growth and compounding returns. Employees will also be able to more easily see when super is paid (aligned with each pay cycle), making it simpler to spot issues early.
Superannuation is a key asset in helping ensure more Australians get the secure retirement they need and deserve. Regardless of your age or current position, we encourage everyone to get more involved with their super. Be on the lookout for the change post 1 July 2026 and ensure your employer is adhering to the rules.
James Alexander (CFP® Professional, GradDipFP, MFinP, BBus [Fin, Mgt]) is an Authorised Representative of Alman Partners Pty Ltd, Australian Financial Services Licence No: 222107.
Note: This material is provided for GENERAL INFORMATION ONLY. It has not been taken into account your personal objectives, situation or needs. The information is objectively ascertainable and is not intended to imply any recommendation or opinion about a financial product. This does not constitute financial product advice under the Corporations Act 2001 (Cth). It is recommended that you obtain financial product advice before making any decision on a financial product such as a decision to purchase or invest in a financial product. Please contact us if you would like to obtain financial product advice.