Superannuation

Last updated July 2026

What is superannuation?

Superannuation (‘super’) is money that is paid to you while you’re working, but it is set aside in a separate account for after you retire.

Union members won super as a right for all workers in 1992 – and we’ve been defending and strengthening it ever since.

Super is the main way most people save for their retirement.

When you’re younger, it might be easy to think that putting aside money to live off in many decades’ time is not that interesting or important.

But it is crucial that your super is on track for you to have a secure and rewarding life after you retire – you deserve it!

How is super earned?

Employers must pay the minimum rate of contribution (the ‘super guarantee (SG) contribution’) into eligible employees’ super accounts.

Remember, your super is in addition to the wages or salary that get paid directly to you.

You can also make voluntary contributions to your super account – by making deposits yourself, or via salary sacrifice (where you agree with your employer to divert some of your wages directly to your super account).

Who is eligible for super?

Generally, most workers are eligible for the SG contribution.

It doesn’t matter if you’re full time, part time or casual – except that if you’re under 18 years old, you’re only eligible if you work more than 30 hours in a week.

How much super does my employer have to pay?

The super guarantee contribution is 12% (as of July 2025).

Employers must pay this minimum compulsory amount, but they can also choose to pay more.

The SG contribution is calculated as a percentage of your ‘qualifying earnings’: ordinary time earnings plus allowances, penalties, bonuses, commissions and leave payments; but excluding overtime.

How does super grow over time?

The account that your super is paid into is usually managed by a super fund.

Part of what they do is invest your money, so that over your working life, your balance grows to be more than just the total of the contributions. You can choose how your super is invested.

There are many super funds in Australia, and you can choose which one you go with. Some are for-profit funds and others are profit-to-member funds, eg. Industry Funds.

It’s worth knowing that Industry Funds were set up by unions, and have higher investment returns and lower fees, than for-profit funds.

How is super taxed?

Contributions to your super from your employer (plus any before-tax voluntary contributions you make) are taxed at 15% up to a limit ($32,500 per year as of 1 July 2026).

This tax rate is considered “concessional” because it is generally lower than the marginal tax rate most workers pay on their income that is earned as salary or wages.

When did super begin in Australia?

There were union campaigns for retirement schemes as far back as the 1920s – but it was the 1960s when super emerged as a major industrial issue and 1980s when super was included in some awards.

The culmination towards universal super peaked in 1992 when unions won the Superannuation Guarentee Legislation.

This established that employers must make a minimum rate of contribution (called the ‘super guarentee (SG) contribution’) to their employee’s super accounts.

At the time it was 3% of workers’ earnings, which grew to 9% by 2002. After years of further campaigning by unions, the SG contribution grew again between 2013 and 2025 to 12%.

The tireless efforts of union members over many decades have led to Australia’s super system being one of the best in the world!

But there is still work to do, like closing Australia’s significant gender gap in workers’ super savings and eliminating wage theft, via stolen super.

Super is a union legacy, and union members won’t stop working to improve our super system until every worker is earning what they deserve and are entitled to.

Four recent union wins that make super even better

Pay day super

As of 1 July 2026, your super must be paid on the same day that you get paid your wages!

Previously, your employer only had to pay your super every quarter. But after years of union campaigning, this has changed!

For most workers, this will mean receiving super either weekly, fortnightly or monthly; whatever your regular pay cycle is (it must reach your super account within 7 business days of your pay day).

Make sure you are keeping an eye on your pay slips and super account to check that you’re receiving your employer’s contributions in line with your pay days.

This change is a huge win for workers that makes it much easier to detect unpaid super – plus, it means a bigger balance is compounding; boosting your long-term retirement savings!

Super on Paid Parental Leave

As of July 2025, the Federal Government pays 12% super on Commonwealth Paid Parental Leave payments. 

Unions long campaigned for this crucial reform, as part of addressing the significant gender gap in super savings (time taken out of the workforce on parental leave disproportionately impacts women).

Currently, the law does not require employers to make super contributions on PPL or during unpaid leave, but agreements, policies or contracts may provide this entitlement.

The right to super

As of January 2024, workers have a stronger enforceable right to super, and stronger grounds to stand up to super-theft, now that the NES includes the right to super contributions.

The entitlement to super aligns with, and refers to, the legislation won by union members over 30 years ago, and means that most workers covered by the NES can take court action to recover unpaid or underpaid super.

Super boost for low-paid workers

From 1 July 2027, there will be changes to the Low Income Superannuation Tax Offset (LISTO):

• the eligibility annual income cut-off threshold will increase to $45,000 (aligning with the second-lowest tax bracket), and
• the maximum payment will increase to $810

The LISTO is a government contribution to super, designed to help low-income workers boost their retirement savings.

Unions have been pushing for years that it has not kept up with the tax system.

By lifting the LISTO, low-paid workers will no longer pay more tax on their super than they do on their wages – and retire with more.

The LISTO reforms (along with other laws to rein in excessive tax concessions for those with the highest super balances) restore fairness to a system that exists to deliver retirement security for all Australians.

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