choice of fund

Employees can choose their super fund if they are:

  • Under former state awards, now known as ‘notional agreement preserving state awards (’NAPSAs')
  • Covered by another award or agreement that doesn’t require superannuation support, or
  • Not employed under any state award or industrial agreement (including contractors paid principally for their labour)
Employees cannot choose their super fund if you are paying them under a Federal industrial agreement such as an Australian workplace agreement (AWA), a certified agreement (CA) or a preserved state agreement.
 
If you have a new employee who is eligible to choose their super fund, the ATO requires you to provide them with an ATO Standard Choice Form within 28 days of the day they start work with you. 
 
You can provide contractors with a Standard Choice Form the first time they work for you and refer to it whenever they work for you again. You only need to pay into one fund for each employee.
 
An employee does not have to choose a fund but you need to give them the choice if they are eligible. If your employee does not choose a fund, you pay super for that employee into the fund you have chosen (your default fund).
 
In the event of an Australian Taxation Office audit you need to be able to provide a copy of the Standard Choice Form and the date it was supplied. 
 
If REI Super is your default fund and the employee chooses another fund, for their choice to be effective they will need to provide you with their chosen fund name, account name and number, method of payment and a letter of compliance.   
 
Failure to do so means that you can continue to pay super to your default fund for this employee. You have 28 days to act on an employee’s choice once the required information is provided. 
 
Click here to download the REI Super Letter of Compliance. 
 
Choice of fund can add to the administrative burden of paying super for staff.  A clearing house enables you to pay all staff super contributions in one payment to your default super fund, who then portion the payment out according to your instruction. For more information on the free REI Super clearing house, please read about MercerSpectrum.