Fact 1 - Not all employers are required to offer their employees Choice.

In summary, those currently excluded from Choice are mainly public sector employees. Although changes may be made in the future to allow Choice for some of these groups, the following individuals, at the time of writing, won't have access:
• employees whose 'contributions' are made to unfunded public arrangements
• commonwealth employees who are members of the CSS, PSS and employees receiving productivity benefit payments
• individuals for whom contributions are being made in accordance with certain Workplace Agreements or certified agreements under the Industrial Relations Act or Workplace Relations Act
• people for whom contributions are being made under a prescribed law (such as where the contributions are made to an unfunded public sector scheme or under a State industrial award, and
• defined benefit fund members who would still get retrenchment and retirement benefits if their employer paid future contributions to another fund.
If your employer clients are unsure of the awards they are covered by, direct them towards their employer association, www.wagenet.gov.au or their lawyer.

Fact 2 - Choice does not apply to all super contributions.

Choice only applies to the SG contributions paid by employers on behalf of employees. Choice does not apply to voluntary, salary sacrifice, additional employer or spouse contributions.

If employers contribute an amount above the SG requirement they can decide which super fund these additional contributions are paid into. Employers can agree to pay these contributions into the fund chosen by their employee, but they are not obliged to do so.

Fact 3 – There are a number of activities employers can undertake with regard to Choice, including:
• identify whether they are affected by choice
• obtain a pre-populated standard choice form (featuring their default fund details)
• ensure they have processes in place to action each completed form within two months of receipt
• pay super contributions into ‘eligible’ funds chosen by employees or into the default fund, if no choice is made
• employer's must provide a standard choice form to all new employees within 28 days, and
• ensure existing employees are aware of their super options in the Choice environment.

Fact 4 – Not all super funds can be default funds - minimum insurance requirements have been set by the Government.

The insurance offered by an employer’s chosen default fund must cost at least $0.50 per employee per week or provide minimum death cover on an age-based scale as shown below:



There are some exemptions to the minimum insurance cover requirement.

All of AXA’s business super products (Business Super Directions, Simple Super and Tailored Super) are eligible default Choice funds.