“If new employees don’t provide their super details during the onboarding process the onus sits on the employer to then take that extra step seek out these details through the ATO.” “All of this means potentially more work for employer’s recruitment and payroll teams ”, Koelmeyer says. If after further requests, there is no alternative fund available, the ATO can advise whether contributions can be made to the employer’s original default fund or another fund that meets the choice of fund rules. If the identified stapled fund does not accept contributions, another request can be made. Once this request is filled, you and the employee will be notified of the request, and the details released. If an employee doesn’t select a super fund, with their consent, you can request the employee’s stapled super fund details from the ATO after submitting a Tax File Declaration or a Single Touch Payroll pay event – demonstrating an employment relationship. Of course, if the employee does nominate a fund on commencement, the employer doesn’t need to identify the stapled fund.Įmployers can still offer or their default fund, but can’t compel a new employee to choose it. “Employers are now obliged to do more, by logging into the ATO and identifying the employee’s stapled fund”. “If any employee doesn’t actively choose a super fund on employment, it is no longer permitted for the employer to simply put them into a default fund”, says Koelmeyer. During the onboarding process if the employee doesn’t specify an existing super fund the employer will need to log into the ATO and look up that employee’s details and see if they have an existing fund ensure that employees contributions are paid into that fund.Īthena Koelmeyer, Principal of employment law firm Workplace Law says that the additional step for employers when onboarding new employees is “absolutely the key to compliance with these new rules”. With the new ‘Super Stapling’ function, an employee’s super fund will be ‘stapled’ to them. The ATO estimates that there are approximately 6 million accounts that are unintended multiples collecting around $450 Million annually in fees. This resulted in a large number of Australians that moved between jobs having multiple super funds with multiple sets of fees, potentially eroding their retirement income. Under the previous ‘default’ superannuation system when an employee started working for a business and they did not select a super fund, their contributions would be paid into a default fund selected by the employer. Super stapling was introduced as part of a package of superannuation reforms announced in the 2020 Federal Budget that came into effect on November 1, 2021.
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