Tuesday, October 7, 2008

What if my employee is not a member of the fund that they nominate?

Quite frankly, this is not your problem as an employer. It is up to the employee to find out how to join the fund that they nominate and to obtain product disclosure statements, information and application forms for that fund.

You need to tell your employee that she/he needs to have joined a fund of their choice by the next due date for super payments to be made, otherwise their super contributions will be paid into the default fund chosen by you.

It is important to remember that as an employer you are not permitted to provide any research, comparisons, or product disclosure statements for any other fund other than your default fund, and you must not try to influence your employee in any way or provide them with financial advice when choosing a super fund.

If you pay super contributions into a super fund that your employee has nominated but not joined, those super contributions may be automatically rejected. Your employee must be a member of a fund they nominate.

In fact, if you use the Superconnect Clearing House, the system will not allow you to pay a super contribution to a fund without the member number. This means that you will not be allowed to make the mistake.

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