(12 January 2026 – Australia) Payday Super reforms effective in the new financial year are set to add more stress to working capital constraints felt by Australian small businesses mandated to cover employee superannuation each pay cycle instead of quarterly.
Payday Super reforms announced in the May 2023 federal budget and passed by the Senate in November 2025 are welcomed by the superannuation industry. Treasurer Jim Chalmers asserts that the reforms will prevent disreputable employers from exploiting their staff with unpaid super balances currently running at over A$5 billion.
The reform is designed to make it easier for employees to spot missed contributions sooner and to get funds into super earlier so balances can benefit from compounding.
The Council of Small Business Organisations Australia (COSBOA) has spoken out about the potential negative impacts of Payday Super with the overarching message that the start date of 1 July 2026 is too soon for small businesses to adopt.
“The current timeline and compliance design risks overwhelming small businesses and undermining the intent of the reform as the proposed legislation lacks realism. We support the intent of Payday Super, but good policy needs to work in practice” commented COSBOA Chair, Matthew Addison.
“Small businesses want to do the right thing, but they need time to prepare, support to manage the compliance costs, and fair treatment when system failures occur that are outside their control. Our suggestion to tackle this is a phased implementation, moving first to payments by 1 July 2026, before the full Payday Super is implemented no earlier than 1 July 2030.”
“This is one of the biggest payroll changes in decades. Small businesses want to get it right but they need a clear, practical and achievable pathway to do so. Payday Super can be a good reform if it’s built on solid foundations. Let’s take the time to build it properly.”
The Association of Superannuation Funds of Australia (ASFA) recently launched the Payday Super Hub to help super funds, employers, administrators and service providers prepare for the new laws. Superfund Rest will also launch a new clearing house solution to help businesses meet their upcoming Payday Super obligations.