Your employer 'stapling' questions answered

YOUR ‘STAPLING’ QUESTIONS ANSWERED

A guide for employers

From 1 November 2021, new ‘stapling’ regulations mean that most working Australians will be linked to one super fund for life, with an account that automatically follows them from job to job – unless they actively choose a different fund.

Below are answers to the most common questions we’re getting from employers at Active Super. We invite you to take a read so you can better understand how the changes might affect you.

If you have any further questions, please feel free to contact us.

Stapling essentially links (or ‘staples’) a super fund to an individual for their working life, so that it automatically follows them whenever they change jobs.

It’s designed to reduce the number of duplicate super accounts, saving many Australians from paying unnecessary additional fees and leaving them better off in retirement.

It comes into effect from 1 November 2021.

From 1 November 2021, employers need to comply with the new stapling regulations and ensure that all new employees have the correct super fund:

a super fund of their choice*
their stapled super fund, or
their award fund.

*Eligible employees only (does not apply to employees where the super fund is prescribed by State or Industrial Award).

Super fund of choice
Whenever a new employee starts, they can still nominate a super fund of their choice. They just need to inform HR and/or Payroll and provide a completed superannuation Standard Choice form. You can find the Active Super Standard Choice form here.    

Stapled super fund
If a new employee doesn’t actively choose a super fund, as their employer, you’ll need to contact the Australian Tax Office (ATO) to ask for their stapled fund details, and to pay contributions into that fund.

Note: There are specific rules for certain industrial instruments (such as State industrial instruments), and the choice and stapling rules may not apply to your employees. You should seek legal advice about the super guarantee rules that apply to your workplace if you’re unsure.

You’ll need to contact the ATO online and request the stapled fund details for any new employee. After you input the employee’s information into the system, you should receive an online response within minutes.

If you have over 100 people starting at the same time, you can make a bulk stapling enquiry. The ATO advises, however, that this may take up to five days to process.

You can find out more about bulk requests on the ATO website.

New employees are still free to choose a super fund, including their employer’s default fund. Stapling only comes into play when an employee does not make a choice.

If an employee chooses a super fund and provides you with a completed super Choice form like this one, you must make payments to this nominated account. You do not have to contact the ATO to confirm whether it’s their stapled fund.

In all cases, we recommend you keep a copy of any super Choice form given to you by an employee, as proof that you are complying with the stapling requirements. 

In order to be stapled, a super fund must meet the following criteria:

It must be a complying fund that can accept contributions from the employer and/or employee. 
The employee must be a current member of the fund. 
The ATO must be able to disclose information about the member or their fund to the employer.

In the case of multiple super accounts, the ATO will consider tiebreaker factors, and prioritise them in the following order: 

The most recently created account
The fund that received the most recent contributions; or
The fund with the largest account balance at the end of the last financial year.

Note: As an employer, you do NOT have to determine the stapled account - the ATO will do that for you. 

For now, the only way employees can verify their stapled fund, is through their employer, who in turn will need to check with the ATO.

No, choice of fund overrides stapling. Employees can nominate their preferred fund at any time using a super Choice form (you can find the Active Super Choice form here). If a new employee hands you a completed, signed super Choice form, you must pay their super contributions into that nominated fund.

Yes. You still need to go online and request their stapled fund details from the ATO.

There are 3 possible situations:

1. A new employee chooses a super fund
If a new employee provides you with a completed super Choice form like this one from Active Super, you must pay their super into the fund they’ve requested.  

2. A new employee doesn’t choose a super fund
If the employee does not provide you with a completed super Choice form, you must request their stapled fund details from the ATO online.    

3. A new employee doesn’t choose a super fund and no stapled fund exists
If they do not provide a super Choice form and the ATO cannot confirm they have a stapled fund, as the employer you must open a super account for them with your default fund and make their super contributions into this account. 

Note: There are specific rules for certain industrial instruments (such as State industrial instruments), and the choice and stapling rules may not apply to your employees. You should seek legal advice about the super guarantee rules that apply to your workplace if you’re unsure.

If the default super fund is recognised as the individual’s stapled fund by the ATO, it will follow them to the next job, unless they actively choose a different super fund.

If a new employee has just arrived in the country for example, or if this is their first job, they may not be able to provide details of a super fund and the ATO may not have any record of a stapled fund. When this happens, as the employer you must open a super account for them with your default fund and make their super contributions into this account.

Any employees who started with you prior to 1 November 2021 are not currently impacted by these changes.

No, a stapled fund search is only required for new employees who commence employment on or after 1 November 2021.

If an employer fails to pay super contributions into a new employee’s stapled fund after the commencement date of 1 November 2021, the employer may be in breach of the stapling obligations and could incur penalties.

Yes, employers still need a competitive default fund as an option for new employees. If a new employee starts on or after 1 November 2021 and doesn’t nominate a fund or doesn’t have a stapled super fund, you must open an account for them with your default fund and make super contributions into that account.

Yes, an employer can still review and change their default super provider. Employees would need to actively choose the new default fund by completing a super Choice form. 

There are specific rules for certain industrial instruments (such as State industrial instruments), and the choice and stapling rules may not apply to your employees. You should seek legal advice about the super guarantee rules that apply to your workplace if you’re unsure.

Generally speaking, however, for new employees starting on or after 1 November 2021, the stapling regulations apply as follows:

To find out more information for employers on requesting stapled fund details, go to the ATO website.
For more information on the Your Future, Your Super reforms, visit the treasury website or the ATO website.
For help and support with stapling, feel free to contact Active Super.

YOUR ‘STAPLING’ QUESTIONS ANSWERED

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