23 November 2021
Stapling has changed the process an employer needs to follow to set up super for new employees who don’t choose a super fund.
We have worked with the ATO to help employers with the introduction of stapling, which came into effect on 1 November 2021.
We hosted a webinar with guest speakers from the ATO to explain how stapling will need to be administered by employers and how the new requirements will work in conjunction with EBA agreements. Watch the webinar.
In conjunction with the ATO we have also put together answers to some frequently asked questions on stapling to help employers understand what’s required under these new laws.
Is it only if a new employee doesn't select any options on the super standard choice form, or doesn't complete a choice form at all, that we need to check with the ATO for their stapled super fund? Or is it even if they select the employer’s default fund?
The requirements for requesting a stapled super fund are when:
- your new employee starts on or after 1 November 2021
- you need to make super guarantee payments for that employee
- your employee is eligible to choose a super fund, but doesn’t, or is a temporary resident, or an employee covered by an enterprise agreement or workplace determination in place prior to 1 January 2021.
If an employee provides a completed choice of fund form to their employer, including where the employee chooses the employer’s default fund, the employer should make contributions to the fund chosen by the employee.
An employer only needs to request a stapled fund for employees who commence on or after 1 November 2021 in circumstances where no choice of fund form is received.
How does stapling work with superannuation requirements under an EBA?
Enterprise agreements (EBAs) made on or after 1 January 2021 offer employees choice of fund. If an employee working under one of these EBAs doesn’t submit a choice of Fund form, you will need to request their stapled fund from the ATO.
Employers with enterprise agreements that were in place prior to 1 January 2021 haven’t had to offer choice of fund to their employees, to date. However, with the new rules, before you can pay to the fund specified in your enterprise agreement you will need to first check with the ATO as to whether or not your employee has a stapled super fund. If they do have a stapled fund, to meet your choice of fund obligations, you will need to pay to the stapled super fund rather than the fund specified in their agreement. If they don’t have a stapled fund, then you may pay to the fund specified in your agreement.
For more information or questions on EBAs, visit fairwork.gov.au or call the Fair Work Infoline 13 13 94.
If an employee chooses their employer’s default fund on the super choice of fund form and signs the form, do you need to check for a stapled super fund with the ATO?
No, if an employee provides a completed choice of fund form to you, including where they chose your employer default fund, you make their SG payment to that fund. You do not need to request a stapled super fund from the ATO.
Do staff still have a choice of super funds?
Yes, there is no change to your requirements to offer eligible employees a choice of super fund within 28 days of their start date.
NOTE: You have two months to start paying into a chosen fund provided by the employee. From 1 November 2021, if a new employee gives you a completed choice form and you opt to not start paying into their chosen fund until after the first super contributions are to be paid for that employee, you will need to request their stapled super fund details to establish where the first contributions are to be paid.
Is there a timeframe in which we need to wait to allow the employee to choose a/another super fund and not the one they currently have?
Employers must provide employees who are eligible to choose a super fund with a super standard choice form within 28 days of their start date. Once an employee tells you their choice of super fund, you have 2 months to start paying contributions into that fund.
If you need to make a Superannuation Guarantee payment and you have not yet received a choice of fund form from your employee, you should request a stapled super fund from the ATO in order to make your initial SG contributions.
Existing eligible employees can change their choice of fund as often as they like. However, you only have to accept a new choice from them once in any 12 month period.
How do we set up a default fund and how can we let employees know that we have a default fund or a fund listed as a part of our EBA?
The process for setting up a default fund has not changed. See select your default super fund for more information. Your default fund must be included in the Choice of Fund form that you give to new employees. If BUSSQ is your default fund, you can download the relevant choice of fund form here.
You cannot provide recommendations or advice about super to your employees unless you are licensed by the Australian Securities & Investments Commission (ASIC) to provide financial advice. Visit ASIC’s website (ASIC Information Sheet 89) for more information on how you can communicate to your employees about superannuation choices without breaking the law.
What does a BAS Agent need to do or Bookkeeper as we handle the super for multiple businesses?
The service to request a stapled fund is available through Online Services for Agents.
If an authorised representative does not have access to Online Services for Agents, they will need to have the 'Employee Commencement Form' permission to make a stapled super fund request for each employer they represent. This permission is available for anyone with full access in ATO online services or can be provided as a specific permission.
Does the TFN Declaration form need to have been received by the ATO before I request a stapled fund?
Yes, before responding to a request from an employer for an employee’s stapled super fund details, the ATO need to be able to confirm that an employment relationship exists. This is done by the employer lodging a TFN declaration or a Single Touch Payroll event. Once either of those processes have occurred, the employer will be able to request a stapled super fund.
The ATO would have to have a record of the employer/employee relationship link before being able to respond to a request for stapled super fund.
Is the ATO opening an online service where employers can email the ATO TFN Declaration so we can establish the relationship on payday if employees don't complete the super information? We often don't get pay details until payday.
TFN declarations can be completed by your employee:
- in ATO online through myGov by completing the “new employee commencement” form and providing you with a copy. This will immediately create the necessary link for you.
- providing you with a completed paper form
- using your payroll software, if enabled for this purpose.
An employer may lodge the TFN declaration online or via paper. Further information is available on the ATO website.
Will the stapled fund provided be an employee’s super account that has not been in operation for a long period of time (and possibly lost)?
In order for the ATO to provide a stapled super fund, the employee must be a member of the fund/scheme, and the account must have a status of ‘open’ within ATO systems.
When a stapled super fund is provided to an employer, the ATO will also notify the employee of these details, ensuring the employee is aware of their current account details.
If the stapled super fund account provided by the ATO can't accept contributions for the employee, you should make another request for the employee’s stapled super fund via ATO online services.
If the same stapled super fund account is returned, call the ATO on 13 10 20 to obtain an alternative stapled super fund account. If there is no alternative fund, the ATO can advise whether contributions can be made to your default fund or another fund that meets the choice of fund rules.
What happens if someone has multiple accounts already and has not combined them before 1 November 2021?
Where an employee has multiple existing eligible super accounts, the ATO will apply 'tiebreaker' rules as outlined in the regulations to select the stapled super fund. These rules consider, as applicable:
- whether the ATO have previously identified an account as a stapled super fund
- how recently contributions have been made to each of the accounts
- the account balances
- how recently each of the accounts were created.
Can we look up new employees to check the information they have provided is accurate?
The ATO takes the privacy of individual’s personal information seriously and has in place several safeguards against misuse of the stapled super fund request service. The stapled super fund request service cannot be used to check an employee’s super fund details provided by an employee on their choice of fund form.
If the details provided by an employee are incorrect, employers will need to request updated details from their employee. An employer could also check the super fund’s website to retrieve publicly available information, including a fund’s unique superannuation identifier (USI). An employer may refuse to accept the fund chosen by the employee if the employee doesn’t provide all the required information, including contact details for the fund, in writing.
As an employer can we request our employer nominated superfund to search and combine super funds for an employee if they have multiple super fund accounts?
No, any requests to consolidate super funds must be made by the employee. While multiple accounts can increase the fees paid by an individual, some individuals have legitimate reasons for holding more than one super product.
An employee can log in to ATO online services through MyGov to keep track of their super. From there they can view their super accounts and are able to consolidate these if they wish. If the employee is a BUSSQ member they can use BUSSQ’s SuperSearch tool to find and combine their super.
This information is general advice only and does not take into account or consider your personal objectives, financial situation or needs. Prepared by BUSS (Queensland) Pty Ltd (ABN 15 065 081 281, AFSL 237860) as Trustee for BUSSQ (BUSSQ Fund, ABN 85 571 332 201) with information provided by the Australian Taxation Office.