Legislation has been passed by the Federal parliament which removes an exemption to pay superannuation contributions to employees who earn less than $450 per month (e.g. part-time and casual employees). This exemption previously existed in the Superannuation Guarantee (Administration) Act 1992 (the SG Act).

These changes are contained in Schedule 1 of the Treasury Laws Amendment (Enhancing Superannuation Outcomes For Australians and Helping Australian Businesses Invest) Act 2022, and will take effect from 1 July 2022.

As a result of the changes, all school-based employees are now entitled to be paid superannuation in accordance with the SG Act, irrespective of any contrary provisions in an Enterprise or Multi-Enterprise Agreement. The only remaining exemption is for employees under the age of 18 who work fewer than 30 hours per week.

Award covered schools

From 1 July 2022, to comply with the SG Act, your school should pay all employees superannuation contributions of 10.5% on their ordinary time earnings, regardless of whether they earn less than $450 in a month. However, your school will not be required to pay superannuation contributions for employees who are under 18 and work fewer than 30 hours per week.

Schools covered by AIS negotiated Multi Employer enterprise agreements

There are a range of specific Multi-Enterprise Agreement (MEA) provisions which indicate that there is an exemption from the requirement to pay superannuation where an employee’s monthly earnings are less than $450 (e.g. paragraph 12.5(ii) of the Independent Schools NSW/ACT Standards Model (Teachers) Multi-Enterprise Agreement 2021), or provide that contributions only need to be made to employees who meet the threshold of the “casual qualification allowance” (e.g. sub-clause 19.3 of the Independent Schools NSW (Support and Operational Staff) Multi-Enterprise Agreement 2021).

AISNSW considers that any provisions in a MEA which:

  • provide for an exemption of employees who earn less than a monthly threshold of $450; or  
  • require employees to meet a "casual qualification allowance" threshold,

will now be inconsistent with the SG Act, and from 1 July 2022, superannuation contributions should be paid for all employees regardless of their monthly income, unless the employee is under 18 years of age and works less than 30 hours per week.

Category 3 EAs: Single employer Enterprise Agreements

Schools that have their own single enterprise agreement (EA), should review the provisions of that EA carefully.

Consistent with our observations above about the MEAs, from 1 July 2022, to avoid risk of non-compliance with the SG Act, schools may need to pay all employees superannuation contributions of 10.5% on their ordinary time earnings irrespective of whether they earn less than $450 in a month, or if they are subject to a casual qualification allowance, to avoid liability for the superannuation guarantee charge.

However, schools will continue to not be required to pay superannuation contributions for employees who are under 18 and work fewer than 30 hours per week to avoid liability for the superannuation guarantee charge.

Please contact the Workplace Management Team on 02 9299 2845 if you have any questions in relation to the above.