Employers required to pay super on Parental Leave Pay from 1 July 2025
Key points:
- From 1 July 2025, employers must pay superannuation guarantee (SG) on government-funded Parental Leave Pay (PLP)
- The SG rate will be 11.5% from 1 July 2025, in line with ordinary time earnings
- Employers will need to include this in their regular super reporting and payment processes.
From 1 July 2025, employers will be required to make superannuation guarantee contributions on government-funded Parental Leave Pay (PLP) for eligible employees.
This change aligns PLP with other leave entitlements such as annual and personal leave, for which super contributions are already required. The SG rate applicable from 1 July 2025 will be 11.5%.
How it works
The Department of Social Services will continue to fund Parental Leave Pay via Services Australia and will also provide funding for the corresponding super contributions. Employers will receive additional funds specifically to meet their new SG obligations.
Employers will be responsible for:
- Paying SG contributions into the employee’s nominated super fund
- Making payments in accordance with the standard quarterly super cycle
- Reporting these contributions through Single Touch Payroll (STP) Phase 2.
These contributions are based on the PLP amount paid to the employee and must be treated similarly to other superannuation obligations tied to salary or wages.
What employers need to do
To prepare, employers should:
- Update their payroll systems and processes to manage super payments on PLP
- Ensure super contributions and STP reporting are correctly configured for affected employees
- Be ready to administer these contributions from 1 July 2025.
The ATO and Services Australia will provide further information and support ahead of the change.
Need help preparing your payroll systems?
Allan Hall can assist you in reviewing your payroll processes, updating superannuation settings and ensuring compliance with these upcoming changes. Contact us today to stay ahead of the new requirements.