What a difference $450 reform will make to your lifestyle

Removal of the monthly threshold for compulsory super will benefit hundreds of thousands of vulnerable workers

- Vita Palestrant

From July 1, hundreds of thousands of low-paid workers will get super for the first time since three decades ago. Until now, workers have had to earn at least $450 a month before their employer was required to pay them super.

"The old requirement to earn $450 per month with one employer before you get paid super compounded financial insecurity for casual and part-time workers, who often have lower pay and are in insecure or precarious work," says Debby Blakey, chief executive of HESTA, one of the largest industry funds. "Super is meant to be for all Australians, paid on every dollar earned."

Removal of the $450 threshold will benefit more than 300,000 workers, 63% of whom are women.

Now they will be paid the superannuation guarantee (SG) on every dollar they earn no matter how many jobs they have.

The threshold applied from the start of super to save employers from the administrative burden of processing small SG amounts at a time when payroll was still manually processed.

The Association of Superannuation Funds of Australia (ASFA) says the threshold has penalised permanent part-time and casual workers; those with multiple jobs who received little or no super; and especially gig economy workers and those on "zero-hour" contracts.

ASFA has long advocated for this significant reform, says CEO Martin Fahy. "Removing this $450 barrier will have a real impact on people's ability to accumulate retirement savings and it will enhance equity across the super system."

The only exception is those under 18 who work less than 30 hours a week.

Fahy says the economy has changed dramatically since super's inception. "We now have a situation emerging of portfolio careers, gig work, multiple employment and young people coming into the economy on a part-time job.