Choice of Fund for Employers

As an employer, you have a number of obligations under the choice of fund legislation. 

Choice of Fund means that many employers must nominate a default fund for their employees’ superannuation payments. The default fund you choose must be a complying superannuation fund and must offer a minimum level of life insurance.  SPEC Super is eligible to act as your default fund.

The general requirements are summarised below. For more complete information view the information below or alternatively, visit the ATO’s choice of fund website.

How to nominate SPEC Super as the default fund

You can nominate SPEC Super as your default fund by providing the Standard choice form to your employees. Eligible employees can choose their own fund but if they do not make a choice or their choice cannot be implemented, you can pay superannuation guarantee contributions for them to the default fund.

Employer obligations under Choice of Fund

If your employees are eligible for Choice of Fund you are obliged to do the following:

• provide any new staff with a ‘Standard choice’ form within 28 days of their starting work
• start to pay Superannuation Guarantee contributions to an employee’s chosen fund within two months of having received from the employee written notification of their chosen fund
• accept one change of fund from an employee every 12 months.

If you do not offer choice to eligible employees you might be penalised for superannuation guarantee purposes.

• You can reject your employee’s choice in a number of situations, including the following:
• The fund chosen is not an ‘eligible choice fund’.
• Your employee has not provided to you the required details about the chosen fund and how you can pay Superannuation Guarantee contributions to that fund.
• Your employee has not provided to you a written statement from the trustee of the chosen fund that the fund is a resident regulated superannuation fund that can accept your Superannuation Guarantee contributions.
• If the chosen fund is a self-managed superannuation fund, your employee has not also provided to you evidence from the Australian Taxation Office that the fund is a regulated superannuation fund.
• Your employee has chosen another fund within the preceding 12 months.

What if my employees are under an award?

Many employers can have an obligation under an award to pay into a specified fund.  You should check any relevant industrial awards for details.

back to top