Rejecting member choice
Under superannuation law, you must give eligible* employees the opportunity to choose their own super fund. Generally, you will then make contributions to the fund they choose.
Of course, if they don’t make a choice, you can make contributions into your default fund.
Do I have to accept their choice?
Generally speaking, you must make contributions to the employee’s chosen fund unless one of the following applies.
1. Insufficient information Your employee needs to provide all necessary information for you to process their super; otherwise you don’t have to accept their choice.
2. Your employee has already made a recent choice Employees are only entitled to make a choice of fund once every 12 months, although you can decide to allow it more often if you wish.
3. The nominated fund doesn’t comply You can only make contributions to an eligible choice fund, scheme or RSA. It must comply with superannuation law, have a RSE licence and offer a minimum amount of life insurance. Note compliance information can be provided on a choice form or in a separate letter.
4. You can’t make contributions to that fund Some funds require you to become a participating employer before you can make contributions, but you can choose not to do so. However, you can’t reject an employee’s choice because the Fund expects payment in a way that is less convenient for you.
What do I do if I don’t accept their choice?
You must notify your employee that you are not accepting their choice and explain why. They may then provide the required information or an alternative choice if appropriate.
You need to make all eligible contributions by the quarterly cut off dates whether or not you accept any employee choices. Contributions must be made to your nominated default fund (as told to your employee in the Standard Choice Form) or according to the employee’s existing choice.
* Some employees may be covered by an award or agreement that specifies which super fund you must contribute to; otherwise, any employee eligible for super is usually eligible to choose their own super fund.
Email: firstname.lastname@example.org | Local call: 1300 128 751 | www.avsuper.com.au