The landscape of Australian payroll is set for its most significant shift in years with the introduction of Payday Super, effective 1 July 2026.
While the change from quarterly to payday superannuation payments might seem daunting, Alltech is already preparing the technology and processes to ensure a seamless transition for our clients. Based on recent industry updates—including insights from Sean Melbourne and Grant Thornton – here is a breakdown of what the legislation means and how we will manage it for you.
The Core Changes: What You Need to Know
Currently, many businesses pay superannuation quarterly. Under the new Payday Super regime, superannuation contributions must be paid at the same time as salary and wages.
Recent updates to the bill have clarified a few critical points:
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The “7-Day” Rule: The requirement is not just that funds are sent, but that they are deposited into the member’s super fund within 7 business days of payday. This timeline is tight, but it provides slightly more breathing room than the originally proposed “calendar days”.
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A “Best Endeavours” Approach: The ATO has indicated that for the first 12 months, they will adopt a “best endeavours” approach to compliance. Employers who can demonstrate they are trying to do the right thing will likely face leniency, whereas “High Risk” employers (those showing no attempt to comply) will be the focus of enforcement.
Why Is This Happening?
The government’s primary motivation is to reduce the “super gap.” Last year alone, approximately $5 billion in superannuation went unpaid. This can happen for many reasons, one being when three months of outstanding super which gets left unpaid due to insolvency or involuntary administration.
By aligning super payments with pay cycles, the system becomes more transparent, and employees benefit from their money being in the market sooner.
The Alltech Advantage: We Are Ready
At Alltech, we utilise Employment Hero and its integrated clearing house, Beam, to manage payroll and superannuation. This technology places us in a strong position to handle these changes with ease.
Employment Hero will also have an alternative clearing house available to customers come Payday Super 2026 utilising Zepto’s real-time payment capability. You can read more about that here.
Currently, we manage the reporting and paying of super separately from the pay run. However, once Payday Super comes into effect, this workflow will change to save you time and ensure compliance:
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Integrated Approval: When you approve a pay run, we will take this as your approval for the superannuation payment as well.
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Automatic Batching: Employment Hero already has the functionality to automatically create a superannuation batch once a pay run is finalised. This functionality will be utilised once Payday Super comes into effect.
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Lodgement: We will oversee the submission to ensure Single Touch Payroll (STP) and superannuation are lodged simultaneously.
Put simply: Payday Super will naturally become a part of our standard payroll service.
What Should You Do Now?
While Alltech handles the processing, “clean data” is more important than ever. The biggest risk area identified is new employee onboarding. With a 7-day turnaround, there is little room for error in capturing a new starter’s super fund details.
We recommend reviewing your onboarding process to ensure employee data is accurate from Day 1.
Next Steps
We will continue to monitor the legislation, and we will provide thorough communications regarding any specific changes to the Employment Hero platform or our internal timelines.
Rest assured, Alltech is ahead of the curve utilising best of breed technology for HR and Payroll, and we are committed to ensuring your business remains compliant with minimal disruption to your cash flow or operations.