Superannuation, commonly called "super," is Australia's mandatory retirement savings program. Employers must contribute a percentage of each employee's ordinary time earnings to a compliant superannuation fund. These contributions accumulate over an employee's working life, providing funds for retirement along with the government age pension.
Current Super Guarantee Rate
The Super Guarantee rate has been increasing over recent years. Currently, employers must contribute 11.5% of an employee's ordinary time earnings. This rate is scheduled to reach 12% from July 2025. These contributions are in addition to the employee's regular salary, not deducted from it, so they represent a real cost to employers.
Who Is Entitled to Super?
Most employees aged 18 and over are entitled to super, regardless of how much they earn. Employees under 18 are entitled if they work more than 30 hours per week. Some contractors may also be entitled to super if they are engaged primarily for their labor. The rules are based on who you are and how you work, not your job title.
Employer Compliance Requirements
- Pay super contributions at least quarterly (soon to be with each pay cycle from July 2026)
- Pay into the employee's chosen fund or your default fund
- Keep records of all super payments
- Report payments through Single Touch Payroll
- Provide employees with a Super Choice form
Consequences of Non-Compliance
Failing to pay super correctly and on time results in the Superannuation Guarantee Charge, which includes the unpaid super, interest charges, and an administration fee. Directors can be held personally liable. The Australian Taxation Office actively audits employers and has strong enforcement powers. This makes working with a compliant EOR particularly valuable for foreign companies employing staff in Australia.