Before the 2021–22 Federal Budget, employees needed to have earned at least $450 a month before employers had the legal obligation to pay their employees their superannuation entitlements. On top of this, the $450 must have come from a single employer.
From 1st July 2022, the Australian Government announced it will remove the $450 per month threshold to expand coverage of super guarantee to eligible employees regardless of their monthly payments.
WHO DOES IT AFFECT, AND WHY SHOULD YOU CARE?
This primarily affects low-income earners and those working in the gig economy, such as food delivery drivers. For example:
A casual employee who earns over $450 a month would readily receive at the very least 9.5% of that amount in superannuation contributions. However, if the same employee works a few hours less, no such entitlement would be recognised.
On the other side, employers now have an additional employee obligation where previously there was at least a threshold amount. With the effects of lockdowns and reduced commerce, it is not hard to imagine how removing this threshold would unnecessarily burden employers.