From November 1 employers will need to review the way you onboard employees and set up their funds will change with super stapling, a government initiative that’s part of the broader Your Future Your Super (YFYS) reforms. This addresses the common problem of holding multiple super accounts and the hefty fees that result. Instead, employees will have a ‘stapled’ account that follows them as they change jobs, leading to less account duplication, lower fees, and a positive impact on their future super balance.

Employers, however, will need to be across what super stapling means for them. With the opening up of businesses after lockdown and busy holiday hiring season soon upon us, take a moment to familiarise yourself with what’s new for super. Here’s what you need to know and how to get ready.

Remind me how superannuation usually works again?

Most small businesses who pay staff are familiar with how to set up and pay superannuation, or super, Australia’s compulsory retirement savings program. Usually, a new employee either shares the details of their existing fund via the super choice form or they elect to use the default fund for your business. However, there will soon be a third part to this process with super stapling.

So, what is super stapling?

A stapled super fund is an existing super account which is linked – or ‘stapled’ – to an individual employee and follows them as they change jobs. The introduction of super stapling by the ATO means working Australians will be attached to one super fund for life unless they choose otherwise. This is designed to reduce the number of super accounts people may collect throughout their working life and maximise retirement savings.

When will it start?

Super stapling commences from 1 November 2021. This means that if a new employee starts either on or after that date and does not nominate a fund by completing a Superannuation Standard Choice form, employers will then have to search for the employee’s ‘stapled’ fund using ATO services.

How can I find and use the stapled super information?

Super stapling will mean adding an extra step in your onboarding process – this will be when you check for a new employees’ stapled account if they haven’t nominated their own. How?

  • The ATO has created a directory via ATO Online Services.
  • After logging in, you’ll need to enter details such as an employees’ TFN, full name, date of birth and address to then receive the details on their stapled fund.
  • If the ATO search returns a stapled fund account for your new employee, you’ll need to set this up as normal within Xero and use it for their super guarantee and any salary sacrifice payments.

Should I make any other changes to my onboarding process?

With the busy holiday season almost upon us, it’s worth reviewing your existing onboarding process so you’re ready to go when the change starts. If a new employee hasn’t completed a Superannuation Standard Choice form, employers will need to have their details (including TFN) to find their stapled super account. Does your current process get you all the paperwork and information you need in time?

What about my default fund?

This process only affects new employees, so anyone in the team who already uses your default fund will stay the same. If the ATO advises that there is no stapled super fund for a new employee, you will be able to make contributions to your default super fund (unless they fall under an EBA or award with a mandatory fund). This is more likely to occur for people who have never had super before, like young people entering the workforce or someone who has moved from overseas.

Where can I find more information?

The ATO has more details available on super stapling for employers.

Should you have any questions on the items above, please contact on 02 9923 2959 or mark@mcaccg.com.au