Choice of Fund

Choice of superannuation fund is a new law that gives many employees the right to choose which superannuation fund will receive their employer superannuation guarantee contributions.

Choice of superannuation fund started on 1 July 2005. You must offer choice of superannuation fund to eligible employees.

What do I need to do?
Eligibility
Standard Choice Form
Default Employer Funds
More information

What do I need to do?

• Identify eligible employees.
• Select a default ‘employer fund’.
• Provide eligible employees with a Standard Choice Form.
• Act on the employee’s choice.

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Eligibility

The impact of choice on your workplace is dependent on the type/s of workplace agreement/s or award/s you have in place. Only some employees are eligible for choice. You may have a combination of eligible and non-eligible employees.

Generally, you must offer choice of superannuation fund to an employee unless you make superannuation contributions for that employee under:

• A state award or industrial agreement.
• A certified agreement or an Australian Workplace Agreement.

If you are not sure what award or industrial agreement, if any, your employees are covered by, you can check with your employer association or www.wagenet.gov.au (for federal awards and agreements and links to information on state awards and state industrial agreements), or phone the workplace relations department in your state or territory.

If you have eligible employees, you must provide them with a Standard Choice Form within 28 days of their commencing work.

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Standard Choice Form

Download the ATO Standard Choice Form with AUST(Q)'s details pre-populated as the default employer fund.

Download a blank ATO Standard Choice Form.

New employees must be provided with a Standard Choice form within 28 days of their commencing work.

You will also need to provide a Standard Choice Form to an eligible employee within 28 days of:

• Receiving a written request from the employee asking for a Standard Choice Form (unless you have provided the employee with a Standard Choice Form within the previous 12 months),
• Becoming aware that you are unable to contribute to the employee’s chosen fund,
• Becoming aware that the employee’s chosen fund has ceased to be a complying fund; or
• Changing your ‘default employer fund'.

You must start to pay SG contributions to your employee’s chosen fund within 2 months after you have received written notification from your employee of their chosen fund.

You can reject your employee’s choice if:

• The fund selected is not an ‘eligible choice fund’.
• Your employee has not provided you with the required details about the chosen fund and how you may pay SG contributions to that fund.
• Your employee has not provided you with a written statement from the trustee of the chosen fund that the fund is a resident regulated superannuation fund which can accept your SG contributions.
• Where the chosen fund is a self managed superannuation fund, your employee has not also provided you with evidence from the ATO that the fund is a regulated superannuation fund.
• Your employee has chosen another fund within the previous 12 months.

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Default Employer Funds

Employers must select a default ‘employer fund’ for employees that do not exercise choice.

If you currently make contributions for an employee to an eligible fund nominated in a Federal Industrial Award, this fund will be the default employer fund, for that employee.

If the award nominates more than one fund, you may choose any one of those nominated funds as your default employer fund.

You may select different default employer funds for different types of employees (for example, where the workplace is covered by different awards or agreements).

A default employer fund:

• Must be an ‘eligible choice fund’ (that is, a complying superannuation fund).
• Must offer a minimum level of life insurance.

AUST(Q) is an eligible choice fund and meets the insurance criteria.

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More information

Call the AUST(Q) Client Services Manager, Sharon Arnold, on (07) 3307 6450.

The following websites provide additional helpful information:

• The Government’s choice website
• Association of Superannuation Funds Australia
• Australian Tax Office (ATO)

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