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The Superannuation Guarantee (SG)

SG legislation requires businesses to make a contribution on behalf of each of their eligible employees to help them save for retirement.

Who is eligible for SG payments?

Most of your employees should be covered by SG legislation. Generally, employees who are paid $450 or more (before tax) in a calendar month and work on a full-time, part-time, or casual basis should receive super contributions.

You need to pay SG contributions for employees who are at work or on leave such as:

  • Paid sick leave
  • Long service leave
  • Annual leave
  • Workers’ compensation (in some circumstances).

Under the legislation, you don’t have to pay SG contributions for employees who are:

  • Earning less than $450 in a calendar month
  • Under 18 years of age and working less than 30 hours a week.
  • Away from work and not receiving pay, such as on parental leave or approved leave without pay.

How much super do you need to pay?

As an employer, you must pay a minimum of 9.5% of each eligible employee's ordinary time earnings each quarter. If your employees are covered by an award or employment agreement which specifies a higher super contribution than 9.5%, you must pay that higher amount.


Ordinary time earnings (OTE) are usually the amount your employee earns for their ordinary hours of work. It includes things like commissions, shift-loadings and allowances, and generally does not include overtime payments.

Super Guarantee rate increase

The SG rate will increase to 10% on 1 July 2021, and then continue to increase until it reaches 12% on 1 July 2025.

 

Date SG Rate
1 July 2016 9.5%
1 July 2017 9.5%
1 July 2018 9.5%
1 July 2019 9.5%
1 July 2020 9.5%
1 July 2021 10%
 1 July 2022 10.5%
1 July 2023 11%
1 July 2024 11.5%
1 July 2025 12%

9.5%

Contributions must be paid on a quarterly basis. However, you can also choose to pay monthly or fortnightly. Once you've decided how you're going to pay your employees' super, then all you need to do is ensure you meet the payment deadlines.

For more information on the superannuation guarantee call the ATO on 13 10 20, or visit the ATO website.