Super Stapling and Superannuation Choice: What Australian Employers Must Know

Australia's superannuation system underwent a significant change in November 2021 with the introduction of "super stapling" — a reform that changed how employers handle superannuation for new employees. If you are still onboarding new staff the old way, you may be breaching your obligations under the Superannuation Guarantee (Administration) Act 1992.

This guide covers super stapling, your choice of fund obligations, and how payday super from July 2026 changes everything again.

What Is Super Stapling?

Super stapling means that most new employees have a "stapled" super fund — an existing super fund that follows them from job to job. The stapled fund is the fund held by the employee at the ATO.

Before November 2021, if a new employee did not choose a fund, you would pay their super into your business's default fund — the fund nominated in your applicable Modern Award (or your own chosen default). This led to employees accumulating multiple super accounts over their working lives, each with separate fees eroding their balance.

The stapling reforms changed this. Now:

1. You must first give the employee a chance to choose their own fund (the Standard Choice Form)
2. If the employee does not choose, you must look up whether they have a stapled fund with the ATO
3. Only if there is no stapled fund do you use your default fund

The Onboarding Sequence

When a new employee starts, your super onboarding sequence must now follow these steps:

Step 1: Offer Choice of Fund

You must provide the employee with a Standard Choice Form (or equivalent) within 28 days of their start date, giving them the opportunity to nominate their preferred super fund.

If the employee nominates a fund, pay their super there. Done.

Step 2: Request Stapled Fund Details from the ATO

If the employee does not return the form or does not nominate a fund:

You must use the ATO's online services for business portal (or your tax agent) to request the employee's stapled fund details. You will need the employee's Tax File Number (TFN) and date of birth.

You can only do this after the employee has submitted their TFN declaration (or they have already been added to the ATO's single touch payroll records for your business).

The ATO will return the stapled fund details (or confirm there is no stapled fund) within approximately 5 business days.

Step 3: Use Your Default Fund (If No Stapled Fund)

If the ATO confirms the employee has no stapled fund, you pay their super into your default fund.

What Is a Default Fund?

Your default fund is the fund nominated in the applicable Modern Award for your industry and workforce. The Fair Work Commission has approved and listed default funds for each award.

You cannot arbitrarily choose any fund as your default — it must be one of the listed default funds for the applicable award, unless your workplace operates under an enterprise agreement that specifies a different fund.

Check the Fair Work Commission's award information for the relevant default funds applicable to your workforce.

My Employee Already Has a Fund — Do I Still Need to Check?

Yes. The Standard Choice Form gives employees the opportunity to nominate any eligible fund, including one they already have. If they do not return the form, you must still follow the stapling process — even if you suspect they have a fund.

You cannot skip the ATO lookup step. Paying into your default fund without checking for a stapled fund is a breach of your obligations.

What Is an Eligible Super Fund?

Not all super funds can receive employer contributions for employees. An eligible fund must be:

• An APRA-regulated fund (most retail and industry super funds qualify)
• A retirement savings account
• A super fund that meets the MySuper or choice authorisation criteria

Self-managed super funds (SMSFs) can accept employer contributions if:

• The employee is a member of the SMSF
• The SMSF provides a letter of compliance showing it can receive employer contributions
• The SMSF's electronic service address (ESA) is provided for SuperStream data transmission

SuperStream: How You Must Pay Super

Since 2015, employers have been required to pay superannuation contributions using the SuperStream data and payment standard. SuperStream means contributions are accompanied by electronic data in a standardised format.

In practice, this means using:

• Super clearing houses (including the ATO's free Small Business Superannuation Clearing House for businesses with 19 or fewer employees)
• Payroll software with SuperStream-enabled payment functions
• Direct data and payment to each fund (if the fund accepts this)

You cannot pay super by cheque to each fund individually without accompanying data — this no longer meets the SuperStream requirement.

Payday Super from 1 July 2026

The most significant super reform in decades takes effect on 1 July 2026. From that date:

• Super must be paid on every payday — not quarterly
• Super must be received by the employee's fund within 7 days of the payday

This completely changes payroll timing. Instead of accumulating super contributions and paying quarterly, each payroll run must trigger a super payment.

Practical implications:

• Your payroll software must support automatic super payment on each pay run
• Your cash flow management must account for super being paid immediately, not 28+ days later
• Manual super payment processes (logging into portals, manual bank transfers) will be unsustainable
• Late payments trigger the Superannuation Guarantee Charge (SGC) — which is more expensive than the missed payment itself

If you are not already using automated payroll software with integrated super clearing house functionality, the move to payday super is the forcing function to upgrade.

The Superannuation Guarantee Charge

When you fail to pay the correct amount of super on time, you must pay the Superannuation Guarantee Charge (SGC) to the ATO instead. The SGC is:

• More expensive than the original super payment (includes a nominal interest component and an administration fee)
• Not tax-deductible — unlike ordinary super contributions, which are deductible
• Reported to the ATO via an SGC statement

Employers who consistently fail to pay super on time can also face criminal prosecution, particularly where the failure appears deliberate.

Director Liability for Unpaid Super

Company directors can be held personally liable for unpaid super obligations through the Director Penalty Notice (DPN) regime, similar to PAYG withholding. If the company fails to meet its super obligations and the ATO issues a DPN, directors must act within 21 days or face personal liability.

Common Super Compliance Mistakes

1. Skipping the ATO stapled fund lookup when a new employee doesn't return their choice form
2. Using a default fund that is not approved under the applicable award
3. Paying super late — even a day late triggers the SGC obligation
4. Paying on ordinary time earnings only — some allowances must be included in the super base
5. Not paying super for eligible casual employees — since July 2022, there is no $450 monthly earnings threshold

How Reguladar Helps

Super obligations are time-sensitive and penalty-heavy — and from July 2026, they become even more frequent. Reguladar tracks your super payment obligations, upcoming legislative changes, and ATO deadlines in your personalised compliance dashboard.

When payday super commences, Reguladar will surface the specific steps your business needs to take to comply — so you are not scrambling in July 2026.

Get ahead of payday super now. Start your free compliance check at Reguladar and see your complete superannuation and payroll compliance picture.