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The government have continued the legislated annual increase to superannuation guarantee contribution percentage, which will increase by 0.5% from 11% to 11.5%, effective from 1 July 2024.
Employees on a remuneration package inclusive of super
Regarding employees on a remuneration package where super is included in their package, it's possible that the package might remain the same and the employees take home pay will be reduced to accommodate the increase in super. This is dependent on the employees’ contract of employment and how their pay is structured within their contract. Alternatively, as an employer, you do have the option to adjust your employee package to increase the package to maintain an employee’s net pay. Our recommendation for either option would be to communicate this to employees prior to any pay adjustments are reflected within the first pay cycle after 1 July 2024.
Employees on a remuneration package plus super
Regarding employees on a remuneration package where super isn’t included in their package, this will result in a superannuation expense increase of 0.5% on employee ordinary times earnings. This is dependent on the employee’s contract of employment and how their pay is structured within their contract. The effective date of the increase is 1 July 2024, which means that for any pay days that fall from 1 July 2024 onwards the 11.5% super rate will apply. This is the case even if part of the pay period was in June. The super calculation is based on the date the employee receives their pay. 
Our recommendations
We recommend that you review employee contracts, communicate to your employees, and agree on the preferred adjustments, prior to 1 July 2024.
FOR MORE INFORMATION
In relation to any questions for clarity on your employees’ contracts, our recommendation would be to clarify this with your HR advisor. Alternatively, if you do not have one available, please reach out to your nearest RSM Representative and we can provide an introduction if required.
