You worked a big overtime week, your payslip looks healthy — and then you check your super balance and find it barely moved. That is not a payroll error. In Australia, employers generally do not have to pay superannuation on overtime, because the super guarantee is calculated on “ordinary time earnings” (OTE), and overtime pay is specifically excluded from that base. The result: extra hours boost your cash pay today but usually add nothing to your retirement savings.
There are important exceptions, though. Some awards, enterprise agreements and contracts require super on overtime, and a few payment types that look like overtime are actually treated as ordinary time earnings. This guide explains the rule, works through the dollars, and shows how to check what your own employer owes you. Compare your figures with our free super calculator.
The rule: super is 12% of ordinary time earnings, not total pay
Since 1 July 2025, the superannuation guarantee (SG) rate is 12% of ordinary time earnings. OTE is defined in the Superannuation Guarantee (Administration) Act 1992 and explained in ATO ruling SGR 2009/2: it is essentially what you earn for your ordinary hours of work — the hours set as ordinary hours under your award or agreement.
The ATO’s position is clear: all earnings are in respect of ordinary hours unless they are remuneration for working overtime hours, or are referable only to overtime or other non-ordinary hours. In plain terms, if the payment exists only because you worked beyond your ordinary hours, it is not OTE, and no SG is payable on it.
| Payment type | In OTE (super payable)? |
|---|---|
| Base pay for ordinary hours | Yes |
| Overtime pay (time-and-a-half, double time) | No |
| Casual loading on ordinary hours | Yes |
| Shift loadings for ordinary shifts | Yes |
| Over-award payments for ordinary hours | Yes |
| Commission for ordinary hours | Yes |
| Paid annual leave, sick leave and public holidays | Yes |
| Unused leave paid out on termination | No |
| Expense reimbursements | No |
The distinction that trips people up is shift loadings versus overtime. A night-shift loading for a shift that falls within your ordinary hours is OTE, so super is payable on it. But the same loading paid for hours beyond your ordinary hours is overtime and is excluded. It is the hours that decide, not the label on the payslip.
Worked example: what overtime costs you in super
Take an employee on $35 an hour who works 38 ordinary hours plus 6 overtime hours at time-and-a-half every week.
| Component | Weekly pay | SG at 12% |
|---|---|---|
| Ordinary hours: 38 × $35 | $1,330.00 | $159.60 |
| Overtime: 6 × $52.50 | $315.00 | $0.00 |
| Total | $1,645.00 | $159.60 |
If super were paid on total pay, the weekly SG would be $197.40 — $37.80 more. Over a year, that is $1,965.60 in super you do not receive despite earning $16,380 in overtime pay. Over a 10-year stretch of regular overtime, the gap is $19,656 in contributions alone, before any investment returns. And because super compounds, the retirement-age cost of that gap is far larger — see our guide to how career breaks affect super for how compounding magnifies missed contributions.
Note the annual figures: ordinary pay of $69,160 attracts $8,299.20 in SG, while the $16,380 of overtime pay attracts nothing. Your effective super rate on total pay is just 9.7% ($8,299.20 ÷ $85,540), not 12%.
When you DO get super on overtime
The exclusion is the default legal minimum, not a ceiling. Employers can pay more, and some must. Check these in order:
1. Your award or enterprise agreement
Some awards and agreements expressly require super on overtime or on all hours worked. This is the most common exception. If your agreement says “superannuation is payable on all earnings” or “on overtime”, that term overrides the default — the employer must follow it.
2. Your employment contract
Contracts sometimes promise super “on total remuneration” or “on gross salary including overtime”. A contractual promise is enforceable even though the SG legislation alone would not require it. Read the super clause in your contract, not just the SG rate.
3. Employer policy or payroll practice
Some employers simply pay SG on total pay for simplicity. If yours does, enjoy it — but confirm it in writing, because a payroll system change could quietly revert to the legal minimum.
4. Salary-sacrificed overtime
If you salary sacrifice into super, the sacrificed amount is an additional concessional contribution on top of SG. Sacrificing some overtime pay into super is one way to close the gap yourself, subject to the $30,000 annual concessional contributions cap for 2025–26.
The grey areas: payments that look like overtime but are not
Not every extra-hours payment is overtime for SG purposes. The ATO looks at substance, not labels:
- Annualised salaries: if your salary is expressed to cover ordinary hours plus a set amount of overtime, the portion attributable to ordinary hours is OTE. An employer cannot label the whole salary “overtime” to avoid SG.
- Higher duties or over-award payments: extra pay for working at a higher classification during ordinary hours is OTE, even if it feels like extra money.
- Shift loadings on ordinary hours: as above, these are OTE. Only loadings tied to non-ordinary hours are excluded.
- Bonuses tied to ordinary hours: a bonus or incentive payment that relates to ordinary hours of work can be OTE, while a bonus purely for overtime hours is not.
If your payslip separates payments oddly, or your employer claims a large part of your pay is “overtime” to reduce SG, that is worth questioning — the ATO’s SG ruling exists precisely to stop re-labelling.
Payday super: does it change anything?
From 1 July 2026, payday super requires employers to pay SG at the same time as wages — every pay cycle instead of quarterly. This changes when super arrives, not what it is calculated on. The OTE base stays the same, so overtime remains excluded under payday super. The practical benefit is that underpayments become visible within a pay cycle rather than at quarter’s end, so check your fund after each payday.
How to check what your employer is paying
- Read your payslip: find the SG amount and compare it with 12% of your ordinary-hours pay (excluding overtime). If it matches, your employer is paying the legal minimum.
- Check your award or agreement: search it for “superannuation” and “overtime” — an express clause requiring super on overtime overrides the default.
- Check your super fund: contributions should now appear each pay cycle under payday super. Compare fund credits with payslip SG amounts.
- Ask payroll in writing: if the numbers do not reconcile, ask which earnings base they use. A written answer protects you later.
- Report shortfalls to the ATO: if SG is underpaid on ordinary hours, you can lodge an unpaid super enquiry through myGov. The ATO can recover the super guarantee charge, including interest.
Closing the gap yourself
If your employer lawfully pays no super on your overtime, you can still close the gap. Salary sacrificing part of your overtime pay into super is usually the most tax-effective option: the contribution is taxed at 15% in the fund instead of your marginal rate (30% plus the 2% Medicare levy for most middle-income earners). Alternatively, make a personal deductible contribution and claim it at tax time — just watch the $30,000 concessional cap and remember that contributions count toward the cap across all sources, including your employer’s SG.
Voluntary contributions also matter for low-income earners: if your total income is $37,000 or less, the Low Income Super Tax Offset refunds the 15% contributions tax up to $500 a year, effectively making employer contributions tax-free.
Frequently asked questions
Is super paid on weekend penalty rates?
It depends on the hours. Penalty rates for weekend shifts that fall within your ordinary hours are OTE, so super is payable. Penalty rates for hours beyond your ordinary hours are overtime and are excluded, even on weekends.
Do casuals get super on overtime?
Casuals get SG on their ordinary hours including the 25% casual loading. Overtime hours for casuals are treated the same way as for permanent staff: excluded unless an award, agreement or contract says otherwise.
What if my employer pays super on overtime voluntarily and then stops?
If the entitlement comes from your award, agreement or contract, they cannot lawfully stop. If it was purely voluntary with no written commitment, they can revert to the legal minimum — which is why getting it in writing matters.
Does overtime count towards the maximum super contribution base?
No. The maximum contribution base ($62,500 per quarter for 2025–26) caps the OTE on which SG is calculated, and since overtime is not OTE, it never counts towards that cap in the first place.
Is super payable on overtime worked during paid leave?
If you are on paid annual leave, the leave payment itself is OTE. Genuine overtime hours worked on top of leave are a different matter and follow the usual overtime exclusion.
Can I salary sacrifice my overtime into super instead?
Yes, if your employer offers salary sacrifice. The sacrificed amount becomes a concessional contribution, taxed at 15% in the fund, and it counts towards your $30,000 annual concessional cap.
The bottom line
By default, overtime pays your bank account but not your super fund. On a $35 hourly rate with six overtime hours a week, that is nearly $2,000 a year in super you never see — and far more by retirement once compounding is counted. Check your award and contract first, because an express clause can override the default; if none exists, consider salary sacrificing part of your overtime into super to close the gap yourself. And under payday super, check your fund every payday — underpayments are now visible in real time. Use our super calculator to model what your overtime pattern means for your retirement balance.