Payday Super commenced 1 July 2026. Australian employers must now have super contributions received by each employee’s fund within seven business days of a qualifying earnings day, not quarterly. Employment Star (employmentstar.com.au) audits and reconfigures Employment Hero for Payday Super compliance — fixed price from $2,340 ex-GST, live in 14 business days.
A month in, most payroll teams we speak to believe they’re across it. Then we open their Employment Hero account and find the super batch still running on a monthly cadence nobody changed on 1 July, or pay categories still flagged against the old earnings test.
The rule is straightforward. Making your payroll software enforce it is where businesses come unstuck, and the failure mode is quiet. Pay runs process normally. Employees get paid. Nothing looks wrong until a contribution bounces back from a fund, or you reconcile in October and find four pay periods where the money left your account on time and arrived at the fund two days late.
If you’ve already moved to paying super every payday, the hard part is done. This is how to confirm it’s landing on time, what happens when it doesn’t, and why the eleven months to 30 June 2027 are the ones that count.
What changed on 1 July 2026
Under the old system you had 28 days after the end of each quarter to pay super: four deadlines a year, and a rolling float of unpaid super sitting in your business account. That’s gone. Super now moves with wages, on the same rhythm as your pay run, and the test of whether you’ve met your obligation is no longer when you paid. It’s when the fund received it.
| Old quarterly regime (to 30 June 2026) | Payday Super (from 1 July 2026) | |
|---|---|---|
| When super is paid | Quarterly | Every time you pay salary or wages |
| The deadline | 28 days after quarter end | Received by the fund within 7 business days of the qualifying earnings day |
| What “on time” means | Payment made by the due date | Money in the fund account, not just out of your bank |
| Earnings base | Ordinary time earnings (OTE) | Qualifying earnings (QE), a new and broader term |
| If you miss it | Superannuation Guarantee Charge, assessed quarterly | SGC, with interest compounded daily and a possible administrative uplift |
| Cash-flow effect | Up to a quarter’s super held in the business | Super leaves with each pay run |
| How often you touch it | 4 events a year | 12, 26 or 52 times a year |
Read the right-hand column again and you’ll see why a configuration that was perfectly compliant on 30 June can be non-compliant on 1 July without anyone touching a setting. The obligation moved. The system didn’t.
"Qualifying earnings" is not ordinary time earnings
This is the single most common configuration error we find, and it costs money quietly.
Payday Super introduced qualifying earnings as the base for calculating super. QE brings together ordinary time earnings and other payments. It is related to OTE but not the same term, and treating them as interchangeable is how businesses end up under-contributing on every pay run without a single error message.
Every pay category in Employment Hero Payroll carries a flag telling the system whether super accrues on it. Those flags were set against the OTE test, often years ago by whoever ran the original migration, and nothing in the software prompted anyone to re-examine them on 1 July.
Start with the categories that have always sat in the grey area: bonuses and commissions, allowances of every kind, leave loading, casual loading, shift and weekend penalties, back pay, and the components of a termination payment. An exclusion that held under the old test has to be re-tested against the QE definition, not assumed to carry over. Check each against ATO guidance at ato.gov.au, and send anything ambiguous to your accountant before you run another pay. An under-contribution repeated 26 times a year compounds quickly.
The seven-business-day clock starts at payday and stops at the fund
The contribution must be received by the employee’s super fund within seven business days of the qualifying earnings day. Received. Not submitted, not debited, not “in transit”.
That matters because almost nobody pays a fund directly. Contributions go through a clearing house, which validates the data, banks the money and forwards it on. Every step consumes part of your seven days, and none are under your control once you hit submit. So it isn’t a seven-day window for you — it’s a seven-day window for the whole chain. If your clearing house takes three business days to distribute, you have four days of internal slack to approve the pay run, create the batch and authorise the payment. If it takes five, you have two.
Work out your actual number. Ask the clearing house your Employment Hero Payroll account submits through what its stated processing time is, and subtract that from seven. That figure is your real internal deadline, and it belongs in your payroll calendar in place of the legislated one. Then map a quarter of pay dates against your state’s public holidays and find the ones that pinch.
What it costs when a contribution lands late
If contributions aren’t received inside seven business days, the Superannuation Guarantee Charge applies. Two features of it should shape how much slack you build into your process.
Interest compounds daily from the qualifying earnings day. Not monthly, not per quarter. On one small contribution that’s trivial. Across a workforce, repeated every fortnight because a scheduling setting is wrong, it isn’t.
An administrative uplift may apply, and it can vary with your compliance history. So the cost of a late contribution isn’t fixed. A business with a clean record and a prompt fix sits in a different position to one that has been late repeatedly and done nothing. Your history is an input, and you’re building it now. The ATO sets out how the charge is calculated at ato.gov.au; the numbers depend on your circumstances, so work them through with your accountant.
PCG 2026/1 — the ATO's first year, and a window that closes 30 June 2027
This is the part almost nobody is talking about, and it’s the most useful thing here.
PCG 2026/1 sets out the ATO’s risk-based compliance approach for the first year of Payday Super, covering 1 July 2026 to 30 June 2027. Under it, employers who have genuinely moved to paying super on payday but have occasional late payments — an incorrect fund detail, a rejected contribution — and who fix them promptly, are likely to be treated as low risk and are not the focus of ATO compliance action in year one.
It’s a reprieve, and a conditional one. It protects employers who made the change and hit the odd bump. It does not protect an employer who never switched over, or who has a systematic fault producing late or short contributions every pay run and no evidence of anyone acting on it. “We didn’t know” is not a prompt fix.
It’s also a deadline. Whatever you fix before 30 June 2027, you fix while the ATO’s stated year-one posture is risk-based. Whatever’s still broken on 1 July 2027 gets assessed on the ordinary rules.
Eleven months sounds generous. It isn’t, once you allow for the fact that most businesses won’t find their problem until they reconcile at the end of a quarter, and then have historical contributions to correct as well as future ones. The businesses that come out of this cleanly are auditing in August, not discovering it in May.
Not sure your Employment Hero is doing what 1 July requires?
We’re a certified Employment Hero implementation partner. We’ll go through your current configuration — pay categories, super batch scheduling, clearing house timing, rejection handling — and tell you plainly what’s compliant, what isn’t, and what it takes to fix. No charge, no obligation.
Five checks to run in your Employment Hero right now
You don’t need us for the first pass. Set aside ninety minutes and work through these in order.
1. Pay run frequency against super batch timing. Put your last eight weeks of pay runs beside your last eight weeks of super payment batches. There should be a one-to-one pairing. If you pay fortnightly but batches appear monthly, you’re carrying a schedule left over from the quarterly regime and every second pay run is already late. Most common fault we find, and the fastest to fix.
2. Qualifying earnings mapping across every pay category. Export your pay category list with the super accrual flag on each and go line by line. Bonuses, commissions, all allowances, leave loading, casual loading, shift and weekend penalties, back pay, termination components. Anything excluded under the old OTE test needs re-testing against qualifying earnings. Send anything ambiguous to your accountant — a wrong exclusion repeats every pay run.
3. Clearing house lead time against the seven-day receipt rule. Confirm the stated processing time of the clearing house your account submits through and subtract it from seven business days. That’s your real internal deadline for approving the pay run and authorising the batch. Check a quarter of submission timestamps against it, watching any pay date sitting next to a public holiday.
4. Employee fund details and the rejection queue. Pull every rejected or returned contribution since 1 July. These are the exact events PCG 2026/1 contemplates, and they only stay low risk if they’re fixed promptly. Then get ahead of the next one: look for missing or malformed fund identifiers and member numbers, new starters without a completed stapled fund check, and anyone on the employer default who shouldn’t be. Give one named person ownership of the queue, with a stated turnaround, in writing.
5. Reporting and reconciliation. Build a monthly reconciliation with three columns: super accrued in the pay run, super paid out of the bank, and super confirmed as received by funds. The third proves compliance and is the one most businesses don’t track. Keep the fund confirmations. Under a risk-based approach, documented evidence that you found and fixed problems quickly is worth more than an assertion that you had none.
If checks 1 or 2 turn up anything, deal with it before your next pay run. Both are systematic faults, repeating since 1 July and continuing until someone changes a setting.
How we fix a Payday Super configuration
We’re a certified Employment Hero implementation partner based in Parramatta, working with businesses across Australia. When a client brings us a Payday Super problem, we start with the audit above, documented, so you have a written record of what was found and when — which matters if you ever need to show you acted promptly. We then correct the pay category mapping against qualifying earnings, reset batch scheduling to pair one-to-one with your pay run cycle, and rebuild the payroll calendar backwards from your clearing house lead time rather than forwards from payday. We quantify any shortfall since 1 July, set up the three-column reconciliation, and hand it over with the process written down.
That’s part of our implementation, fixed from $2,340 ex-GST, live in 14 business days. Complex multi-award environments run 20–25 business days, and there’s a full breakdown of what an Employment Hero implementation costs if you want numbers first.
If you’d rather not own the process, our managed payroll service runs the pay cycle and super batches for you from $350/month ex-GST for up to 20 employees. If the real fault is that nobody was properly trained on the payroll module, Employment Hero training is usually the better spend, and there’s more on our Payday Super readiness work as well.
This article is general information only and does not constitute legal, tax or financial advice. Obligations vary by business, industry and applicable modern award. Check your circumstances with the ATO, the Fair Work Ombudsman, or a qualified adviser.
Payday Super FAQs
When did Payday Super start in Australia?
Payday Super commenced on 1 July 2026. From that date, employers must pay super at the same time as salary and wages rather than quarterly, and contributions must be received by the employee’s fund within seven business days of each qualifying earnings day. The old 28-days-after-quarter-end deadline no longer applies.
Is qualifying earnings the same as ordinary time earnings?
No. Qualifying earnings is a new term introduced with Payday Super that brings together ordinary time earnings and other payments. It is related to OTE but not identical, which is why pay categories mapped under the old test need re-checking. Confirm your specific categories against ATO guidance at ato.gov.au.
What happens if super is received late under Payday Super?
The Superannuation Guarantee Charge applies. It includes interest compounded daily from the qualifying earnings day and a possible administrative uplift that can depend on your compliance history. The charge is calculated on your circumstances, so work the numbers through with your accountant rather than estimating them.
What is PCG 2026/1 and does it protect my business?
PCG 2026/1 sets out the ATO’s risk-based compliance approach for the first year of Payday Super, from 1 July 2026 to 30 June 2027. Employers who moved to paying on payday and fix occasional late payments promptly are likely treated as low risk. It runs out on 30 June 2027.
Does Employment Hero handle Payday Super automatically?
Employment Hero Payroll supports paying super each pay run, but it does what it’s configured to do. Batch scheduling, pay category mapping and clearing house lead times all need setting correctly. A system configured for the quarterly regime keeps behaving that way until someone changes it.
How long does it take to fix a Payday Super configuration?
For a straightforward setup, we audit, correct and hand back a documented configuration inside our standard 14-business-day implementation window, fixed from $2,340 ex-GST. Complex multi-award or multi-entity environments take 20–25 business days. The audit itself is free and takes us about a week to turn around.
Get the eleven months you've got left working for you
PCG 2026/1’s transitional approach ends on 30 June 2027. As a certified Employment Hero implementation partner, we’ll audit your Payday Super configuration, tell you exactly where the gaps are, and quote a fixed price to close them — from $2,340 ex-GST, live in 14 business days.
+61 466 614 475 · info@employmentstar.com.au
About Employment Star — We’re a certified Employment Hero implementation partner based in Parramatta, NSW, working with small and medium businesses across Australia. We handle Employment Hero setup, modern award configuration, data migration, STP Phase 2 and Payday Super — fixed price from $2,340 ex-GST, live in 14 business days.
Published 3 August 2026 · Last updated 3 August 2026