From 1 July 2005, changes to the law mean that many Australian employees will be able to choose which fund their employer's future superannuation guarantee contributions are paid into.
Employees will be eligible to choose the fund for their future superannuation guarantee contributions unless:
- their super is paid under a state award or industrial agreement, or
- their super is paid under a certified agreement or an Australian Workplace Agreement, or
- they are a federal or state public sector employee excluded from choice by law or special regulations, or
- they are in a particular type of 'defined benefit' fund or they've already reached a certain level of benefit in that fund.
Employees need to know about these changes as they enable them to choose who manages their investment for retirement.
Employees do not have to choose their own superannuation fund. If they don't, their superannuation contributions will be paid into a fund chosen by their employer. For existing employees, this could be the fund that they are already a member of - and it may also be the best fund for them.
While employees can choose a fund at anytime, their employer has to accept only one choice from them in a 12-month period.
The Australian Government website, http://www.superchoice.gov.au , details more about choice of superannuation fund and how it might affect you, as well as lots of general information about why superannuation matters and how it works.
© Copyright Commonwealth of Australia, 2005. http://www.superchoice.gov.au/default.asp