Pay The Nanny Responds to ABC News Investigation Into Nanny Superannuation Laws

The Issue Raised By ABC News

The recent ABC News investigation focused on a little-known exemption within Australia’s superannuation system.

Under current rules, domestic workers employed in private homes, including nannies, are generally not entitled to compulsory superannuation contributions unless they work more than 30 hours per week for a single employer. (ABC News)

For many nannies, this creates a major gap.

Unlike traditional employees who may work for a single business full-time, nannies often split their hours across multiple families. A nanny could work 20 hours for one family and another 20 hours for another family, effectively working full-time overall, while still legally falling outside compulsory super requirements under each separate employment arrangement.

ABC interviewed Melbourne nanny Jess Renn, who explained:

“I've worked [a maximum of] 30 hours [with] one family and 20 hours [with] another family, so that's where it has greatly affected me because [in] any other job, those are full-time hours.”

The article also highlighted modelling from the Super Members Council Australia estimating that around 40,000 domestic workers could be impacted during the 2026-27 financial year alone. (ABC News)

Why This Matters

At Pay The Nanny, we see firsthand how much the nanny industry has professionalised over the past decade.

Today’s nannies are not simply “casual babysitters”. Many are long-term employees providing structured childcare, educational support, transport, household coordination, and emotional stability for families across Australia.

For many households, a nanny becomes one of the most important people in a child’s life.

That is why this discussion matters.

While the current exemption is legal under ATO rules, the reality is that it can leave long-term childcare professionals significantly behind in retirement savings compared to workers in other industries.

The ABC article referenced estimates that some domestic workers could retire with approximately $130,000 less in superannuation because of the current rules.

The issue also disproportionately affects women, who make up the vast majority of the domestic workforce.

The Industry Is Already Moving Towards More Formal Employment

One of the biggest changes we have seen in recent years is families increasingly wanting to “do things properly”.

That includes:

• PAYG tax withholding
• Fair Work compliance
• Workers compensation insurance
• Employment agreements
• Leave entitlements
• Superannuation

Even in situations where superannuation may not technically be compulsory, many families still choose to contribute voluntarily because they recognise the value and professionalism of their nanny.

Importantly, upcoming Payday Super reforms from July 2026 will further modernise how superannuation is administered in Australia.

The conversation around domestic worker exemptions is likely to continue alongside these broader reforms.

Our View at Pay The Nanny

At Pay The Nanny, our general position is simple:

Nannies should be treated as legitimate employees, not part of an informal cash industry.

The nanny industry has evolved significantly, and many of the historical assumptions that originally shaped these exemptions no longer reflect how modern nanny employment actually works.

The original purpose of the 30-hour rule was to avoid small super balances being eroded by fees. However, modern protections around low-balance super accounts have largely addressed those concerns.