What is stapling

Your Future, Your Super’s stapling rule aims to limit the creation of multiple super accounts among Australian workers when they change jobs. From 1 November 2021, employees will have their existing super fund ‘stapled’ to them when they change jobs. Put simply, this means that one super fund will follow an employee from job to job, and contributions will be paid to that super fund, unless they explicitly decide to sign up for another super fund. This is in contrast to the current system, where when an employee changes jobs, their contributions are defaulted into their new employer’s chosen super fund, unless they nominate a different super fund. From 1 November 2021, those new to the workforce will be ‘stapled’ to the first super fund they join.

This change is intended to limit the creation of unintended multiple accounts amongst employees when changing jobs, which, the Productivity Commission estimates cost members $2.6 billion annually in unnecessary fees and insurance premiums. While the potential savings on fees and costs will be a positive outcome for employees, one of the possible downsides for employees is the potential for them to be unknowingly stapled to an underperforming super fund.

An upside of this change is that there are measures in place to increase the transparency across the super industry in terms of performance and fees. From a CSC perspective, this means we’re boosting our focus on ensuring our customers understand how their super works, how their super can help them in the moments that matter, and what measures we have in place to protect and grow their retirement savings.

It’s important to note that stapling does not impact employees with defined benefit accounts, such as PSS, CSS, MilitarySuper or DFRDB accounts. These defined benefit accounts are excluded from the stapling changes. Their respective rules around eligibility take priority over stapling.

This information is for guidance only. For specific information regarding “stapling” please contact the ATO.