Is super paid on overtime?

Does your employer have to pay super on any overtime you’ve worked? It’s a common question, especially for workers who receive overtime payments.

The short answer is no – but it’s worth having a thorough understanding of how your pay is made up because super, as a minimum, must be paid on just ordinary time earnings (OTE), including commissions, leave loading, back pay and bonuses.¹

It is important to note, however, that some employers, including the Queensland Government, have different contribution arrangements and, in those cases, employer obligations may differ from those outlined here.

Many professions give people the opportunity to work overtime, such as nurses, police officers, and corrections staff.

But, generally, your employer is not required to pay superannuation on the portion of your pay earned from working overtime.² This is because overtime payments are not OTE, provided your ordinary hours of work are clearly identified in an award or agreement.

How much super should you be paid?

At the centre of Australia’s super system sits the Superannuation Guarantee, which stipulates that employers must pay a minimum 11.5% of an employee’s OTE into their designated superannuation account.

Take control of your super

Knowing how your wages are made up allows you to monitor whether you are receiving all of your super entitlements.

And while the amount of overtime you earn is not reflected in the sum your employer contributes to your super account, there are still opportunities to use that extra money to grow your retirement nest egg.

Contributions count

Money earned from working overtime could possibly allow you to salary sacrifice voluntary contributions, which can be a tax-effective way of saving for the future.

This means paying money into your super from your before-tax salary, which may have the additional bonus of reducing the amount of income tax you pay.

Another option is to make periodic after-tax voluntary contributions to your super account from overtime earned. Also known as non-concessional or personal contributions, these after-tax payments can be made up until you turn 75. See our Personal Contributions Guide for more information.

Even small amounts paid regularly into super this way can have an impact on your retirement balance when it comes time to wind down your working life. It is important to be aware that there are some limits to how much you can contribute to your super fund each year (contribution caps). If you go above these limits, you may pay extra tax.

How to stay on top of super

Simply log in to Member Online or download the QSuper app

 

1. Australian Tax Office, updated 6 March 2023, List of payments that are ordinary time earnings, accessed 15 February 2024 at ato.gov.au
2. Australian Tax Office, How much super to pay, accessed 1 July 2024 at ato.gov.au