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Payday Super is fast approaching! As part of your preparation for this payroll change, you will need to advise your employees about how Payday Super will affect them. To assist you, I have created a draft letter that you can use for this purpose. Feel free to copy this letter and use it as required. I have also added an FAQ document that you can attach to this letter to provide further information to your employees – see below.
Dear team,
From 1 July 2026, the Australian Government is introducing a change called Payday Super. I wanted to explain what this means and how (or if) it will affect you.
What is Payday Super?
Currently, most employers pay superannuation guarantee (SG) contributions to employees’ super funds quarterly. Under Payday Super, employers will need to pay super at or close to each payday instead.
In simple terms: your super will be paid more frequently into your super fund, aligned with your pay cycle, rather than in larger quarterly batches.
What stays the same for you
- The super guarantee rate (the percentage of your ordinary time earnings that must be paid as super) is not changing because of Payday Super.
- Your overall super entitlement does not reduce – the same percentage of your eligible earnings must still be paid into your super.
- Your take‑home pay on your payslip should look the same. What’s changing is when your super is paid to your fund, not how much you are paid in wages.
What will feel different
- You should start to see more frequent super contributions appearing in your super fund transaction history, rather than big quarterly amounts.
- Super contributions will need to reach your fund within a short period after each payday (current guidance suggests around 7 business days, but the ATO will confirm final rules closer to 1 July 2026).
- The ATO will have near real‑time visibility over whether super is being paid on time, which is designed to reduce unpaid and late super across the system.
What we are doing as your employer
To get ready for Payday Super, we are:
- Reviewing and updating our payroll software and processes so that super is calculated and paid each pay cycle.
- Checking our SuperStream / clearing house arrangements so contributions are sent promptly and reach your fund within the required timeframe.
- Reviewing how our different pay items (ordinary hours, allowances, loadings, bonuses, leave, etc.) are treated for super to ensure they align with ATO guidance.
Our goal is for this transition to happen smoothly in the background so that you don’t need to worry about whether your super is being paid on time.
What you may need to do
For most employees, there will be very little you need to do. However, it’s a good opportunity to:
- Check your super fund details are correct (fund name, USI/product code and member number).
- Let us know promptly if you change super funds so we can update your details before the next pay cycle.
- Log in to your super account from time to time to confirm contributions are being received.
We can’t provide personal financial advice, but if Payday Super raises questions about your retirement savings, you may like to speak with your super fund or a licensed financial adviser.
Timing and next steps
Payday Super is planned to start from 1 July 2026. Some finer details (such as the final definition of “qualifying earnings” for super and exact timing rules) are still being confirmed by the Government and the ATO.
We will keep monitoring official guidance and will update you if anything changes or if there are further steps you need to take.
If you have any questions about how Payday Super will work in our business or how it might affect you, please reach out.
Kind regards,
[Employer name]
[Business name]
