If you're a CFO or CHRO for an organisation that employs Australian workers, the new Payday Super legislation coming into effect in 2026 represents a critical inflection point, not just a compliance deadline.
Luke Bebbington
Industry Advisor, Financial Services
Workday APAC
The Federal Government's 'Payday Super' legislation is a fundamental shift in managing super contributions, designed to secure Australians' retirement savings. While this will require significant adjustments to your payroll and accounting systems, you should view it as a powerful opportunity to build a more intelligent, predictive, and truly strategic payroll function.
Report
Payday Super will require all employers to pay their employees' super at the same time as their salary and wages, so it lands in their nominated super account within seven calendar days. It is expected to come into effect on 1 July 2026. This will replace the current quarterly payment cycle, which will no longer be compliant. The legislation is expected to include new fines for late, missed or underpaid super contributions.
By paying super on a more frequent basis and with greater transparency, Payday Super will help Australian employees enjoy the compounding effect of their investment sooner, as well as track their super payments in real time. It will also help the ATO tackle unpaid superannuation — which could save Australian workers up to $5.7 billion in unpaid super — as well as reduce liabilities on the books for Australian employers.
If you're a CFO or CHRO of an SMB, you'll also need to find an alternative platform to the ATO's Small Business Superannuation Clearing House, which will be retired from 1 July 2026.
Payday Super represents a significant shift in the way your team will manage employee entitlements and payroll admin, particularly when it comes to managing risk.
Moving from just four deadlines a year to anywhere between 12 and 52 means you need to plan ahead, as even one late payment can trigger penalties (including a new superannuation guarantee charge) that are far tougher than under the old rules.
CEOs and CFOs are ultimately responsible for non-compliance — not the software provider — so it's important to make sure payroll teams understand the new requirements.
The cash flow impact on your business also needs to be carefully considered, given that many organisations will move to monthly super payments (or even weekly for some industries). To address these risks, here are some things to consider before the legislation comes into effect in 2026.
CEOs and CFOs are ultimately responsible for non-compliance — not the software provider — so it's important to make sure payroll teams understand the new requirements and take ownership of these within the scope of their role. This includes setting up payroll systems to make super contributions every pay cycle, and understanding the impact this may have on cash flow forecasts and working capital.
Your payroll team should own the configuration and ongoing accuracy of your payroll system for specific use cases in your business, such as award interpretation and payment classifications. If they don't understand how an ERP arrived at a result, they will begin to mistrust and manually override it, causing a ripple effect of errors.
By seeing your payroll team as key stakeholders in this change, they'll have an opportunity to demonstrate their value to the business and begin seeing themselves as a strategic function, rather than simply a transactional one. This has numerous benefits, particularly as workflows shift to being more automated, and payroll teams have more capacity to share insights that will drive smarter decision making.
Before your team makes any significant changes to your payroll system, it's critical they get aligned on internal controls and data integrity. The first step is a deep understanding of your business’s processes, particularly the complexities of award interpretation and allowance application.
Many older systems are proving to be too outdated and complex to keep pace with legislative changes like Payday Super.
Payroll is the end-point for all incoming employee data, so a ‘pre-implementation’ project to map, document, and agree on these processes will ensure that when Payday Super changes are implemented, key decisions (such as whether an allowance is subject to the Super Guarantee) are already settled, preventing mistakes and confusion.
The ATO is facilitating faster processing by leveraging the New Payments Platform (NPP) for SuperStream data and payments. This allows your business to address errors faster and more efficiently, but only if your internal systems are configured for this speed. Reviewing operational processes with this in mind will ensure you stay on top of deadlines and avoid fines, interest and other charges.
Many older systems are proving to be too outdated and complex to keep pace with legislative changes like Payday Super. To stay compliant, it's important to make sure that your payroll solution will be compatible with Payday Super by July 2026, and understand what upgrades or reconfigurations you may need to make more frequent payments and address use cases unique to your business.
It's also a good opportunity to understand how you can streamline and simplify your payroll data, to improve accuracy and reporting. To become an intelligent, AI-powered function, you need a clean and accurate data set. This reduces time spent on manual compilation and matching of multiple data sources, and enables teams to spend more time analysing the data and providing strategic insights and value.
The Payday Super reform is more than a compliance burden, it's an exciting opportunity for a strategic reset of your payroll team's scope, workflows and technology — especially if you're thinking about changing your payroll software provider before the legislation comes into effect on 1 July 2026.
By conducting a deep review of your people, processes and platform, your payroll team will be in a strong position to implement Payday Super with speed and accuracy.
Rather than simply 'lifting and shifting' your existing software (and the current payroll challenges you may be facing), it's a good time to step back and think about what you're trying to strategically achieve as a business, and how payroll can support those goals. Nothing should be off the table: think big and imagine your ideal state when it comes to payroll, and see how close you can get using the technology that's available.
By conducting a deep review of your people, processes and platform, your payroll team will be in a strong position to not only implement Payday Super with speed and accuracy, but feel empowered to work for an organisation that values their expertise and gives them the tools and capacity to do the best work of their life.
Report
Discover how agentic AI can add value to your finance function, based on real experiences from Australian leaders like you.