National Minimum Wage crosses $1,004.90, with employer groups warning of cost pressure ahead
Australia's minimum wage increased Wednesday, lifting pay for millions of workers while employer groups warn the rise compounds pressure from a separate superannuation reform taking effect the same day.
The Fair Work Ombudsman confirmed the National Minimum Wage is now $1,004.90 per week, or $26.44 per hour, based on a 38-hour week. Casual employees entitled to the National Minimum Wage must receive at least $33.05 per hour, inclusive of the 25% casual loading.
Employees covered by a modern award must receive a 4.75% increase to their minimum wages, provided the lowest ongoing rate reaches at least $1,004.90 per week and entry-level rates for the first six months of employment reach at least $978.10 per week.
The Fair Work Commission (FWC), a separate body from the Ombudsman, announced the increase on 2 June following its 2026 Annual Wage Review. The increase exceeds the 4.2% inflation rate recorded in April, though it falls short of the 6% rise unions had sought, SBS reported.
Fair Work Ombudsman Anna Booth said employers must apply the new minimum wage from the first full pay period after 1 July.
The timing adds complexity. From 1 July, employers must also begin paying superannuation contributions at the same time as wages under the new Payday Super rules, a shift from the previous quarterly payment cycle.
The Australian Prudential Regulation Authority said the reform is intended to address unpaid superannuation, which the Australian Taxation Office estimates exceeded $6 billion in the last financial year. Employers still using the ATO's Small Business Superannuation Clearing House had to transition to an alternative provider before the service closed permanently on 30 June, a day ahead of the new wage rates.
Employer groups flag cost pressure
The Australian Chamber of Commerce and Industry said the 4.75% increase would be "too much to bear" for small businesses, which would need to pass on costs to consumers or absorb them. ACCI policy chief David Alexander said the rise "could be the tipping point for some businesses."
Treasurer Jim Chalmers maintained the increase represented a real wage gain when measured against the April inflation figure and the government's 2.5% budget forecast for 2026-27. FWC president Adam Hatcher noted last year's increase had narrowed the real wage gap, but rising inflation widened it again.
Separately, the Minister for Employment and Workplace Relations, Amanda Rishworth, pointed to enterprise bargaining data released Monday showing wages under enterprise agreements have grown faster than the Wage Price Index for seven consecutive quarters. Private sector agreements delivered average annual increases of 4.1%, against 3.5% in the public sector.
The award increase is expected to affect roughly 2.8 million workers, or about 21.1% of the national workforce, while the National Minimum Wage change applies to a smaller cohort of around 100,000 employees not covered by an award or agreement.
The Fair Work Ombudsman has updated its Pay Calculator and pay guides to help verify new rates against relevant awards. Employers with enterprise agreements must also confirm base rates have not fallen below the updated award or National Minimum Wage floor.
