Quick Summary
Quick Summary
- The Fair Work Commission lifted modern award minimum rates by 4.75% from the first full pay period on or after 1 July 2026
- Hospitality Award Level 1 base rate is $26.44/hr, with casuals receiving $33.05/hr including the 25% loading
- Saturday penalty is 1.25x for permanent staff, Sunday 1.5x, and public holidays 2.25x — casuals receive higher multipliers
- Civil penalties for underpayment reach $93,900 per contravention, with each employee counting as a separate contravention
- Payday Super rules from 1 July 2026 require super to be paid at the same time as wages, not quarterly
If you run a pub, cafe, restaurant, or hotel in Australia, the Fair Work Commission’s 2026 Annual Wage Review has lifted your wage bill by 4.75%. From 1 July 2026, every employee covered by the Hospitality Industry (General) Award (MA000009) must be paid at updated minimum rates — and getting it wrong can cost you up to $93,900 per contravention. Here’s what every hospitality employer needs to know about current pay rates, penalty rates, casual loading, and compliance obligations.
What Are the Current Hospitality Award Wage Rates?
The Fair Work Commission’s 2026 Annual Wage Review increased all modern award minimum rates by 4.75% from the first full pay period on or after 1 July 2026. The National Minimum Wage rose to $26.44 per hour ($1,004.90 per week), which also became the floor for the lowest-paid award classifications.
The Hospitality Industry (General) Award 2020 (MA000009) covers most pubs, hotels, bars, cafes, and catering businesses across Australia. If you operate a standalone restaurant, the Restaurant Industry Award (MA000119) may apply instead — but the base rates are very similar.
Classification Rates From 1 July 2026
| Level | Base Rate/hr | Casual Rate/hr | Annual (38 hrs) |
|---|---|---|---|
| Level 1 | $26.44 | $33.05 | $52,245 |
| Level 2 | $27.08 | $33.85 | $53,510 |
| Level 3 | $27.97 | $34.96 | $55,269 |
| Level 4 | $29.45 | $36.81 | $58,193 |
| Level 5 | $31.30 | $39.13 | $61,849 |
| Level 6 | $32.13 | $40.16 | $63,489 |
Casual rates include the 25% casual loading, which compensates for no paid leave, no notice of termination, and no redundancy entitlements. If an employee’s duties have grown — running sections solo, training juniors, or handling opens and closes — their classification should reflect that before you apply the new rates.
Hospitality Award Penalty Rates Employers Must Apply
Penalty rates are where most hospitality employers come unstuck. A flat hourly rate that covers the weekday base rate will almost always underpay on weekends and public holidays.
| Day/Time | Permanent | Casual | Level 1 Base |
|---|---|---|---|
| Saturday | 1.25x | 1.5x | $33.05/hr |
| Sunday | 1.5x | 1.75x | $39.66/hr |
| Public Holiday | 2.25x | 2.5x | $59.49/hr |
| Overtime (first 2 hrs) | 1.5x | 1.5x | $39.66/hr |
| Overtime (after 2 hrs) | 2x | 2x | $52.88/hr |
For casual employees, the higher multiplier already includes the 25% casual loading — don’t add it on top again. The Fair Work Ombudsman’s pay guides provide detailed rates for every classification and employment type.
Junior Pay Rates (Under 21)
Junior employees are paid a percentage of the adult Level 1 rate:
| Age | % of Adult Rate | Hourly Rate | Casual Rate |
|---|---|---|---|
| Under 17 | 50% | $13.22 | $16.53 |
| 17 | 60% | $15.86 | $19.83 |
| 18 | 70% | $18.51 | $23.14 |
| 19 | 85% | $22.47 | $28.09 |
| 20+ | 100% | $26.44 | $33.05 |
Juniors aged 18 or over who serve alcohol must be paid the full adult rate for their level.
⚠️ Don’t apply 2025-26 pay rates to July 2026 pay runs
The 4.75% increase applies to the first full pay period on or after 1 July 2026. If your pay cycle straddles 1 July, the old rates apply until the new pay period starts. Using last year’s rates for even one full July pay period constitutes an underpayment.
Key Takeaways
Key Takeaways for Employers
- ✓Update all classification rates to reflect the 4.75% increase before your first July pay run
- ✓Flat rates that covered old minimums may now underpay — test every annualised salary arrangement against new rates
- ✓Record actual hours worked, not rostered hours — 7-year retention is mandatory under s.535 of the Fair Work Act 2009
- ✓Casual conversion requests must be actioned in writing within 21 days after 6 months, or 12 months for small business
- ✓Intentional wage underpayment is a criminal offence carrying up to 10 years’ imprisonment and $7.825M in fines for companies
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Annualised Salary Arrangements: The Hidden Risk
If you pay a flat salary or annualised wage to hospitality staff, the Fair Work Act 2009 requires it to genuinely compensate for all entitlements — including penalty rates, overtime, evening loadings, and casual loading. After the 4.75% increase, a salary that was compliant last year may now fall short.
Employers must conduct an annual reconciliation comparing what the employee actually received against what they would have earned under the Award. If the annualised amount is less, you must pay the difference. This is where well-meaning venues most often slip into underpayment — a flat rate that looked generous against last year’s minimums becomes a compliance breach overnight.
Payday Super: What Changed on 1 July 2026
The superannuation guarantee rate remains at 12%, but from 1 July 2026, Payday Super rules require employers to pay super at the same time as wages — not quarterly. Failing to pay super on time under the new rules attracts the super guarantee charge, including interest and administrative penalties. See our payroll compliance guide for details on aligning your systems.
Employer Compliance Checklist for Hospitality Venues
Beyond paying the correct rates, hospitality employers face several ongoing obligations under the Fair Work Act 2009 and the Hospitality Award:
- Record-keeping: Maintain employee records for 7 years under s.535, including actual start and finish times — not rostered hours
- Payslips: Issue within one working day of payday with all required fields, including employer ABN
- Casual conversion: Employees can request conversion after 6 months (12 months for small business); respond in writing within 21 days
- Employment contracts: Written contracts for all employees reflecting current classification and rates
- Reconciliation: Annual review of annualised salary arrangements against actual Award entitlements
For hospitality-specific templates and compliance documents, visit our hospitality industry page or download free employment documents to get started. You can also explore HR best practice resources for broader compliance guidance, or learn about membership plans starting from $118/month.
What Happens If You Get It Wrong
The consequences of non-compliance with the Hospitality Award are severe:
- Civil penalties: Up to $93,900 per contravention for companies, $18,780 for individuals
- Per-employee multiplication: Each affected employee is a separate contravention — underpaying 10 staff the same way is 10 separate contraventions
- Record-keeping failures: Separate contraventions from any underlying underpayment, compounding total exposure
- Criminal wage theft: Intentional underpayment is a criminal offence carrying up to 10 years’ imprisonment and fines of up to $7.825 million for companies
The Fair Work Ombudsman does not need a complaint to investigate a hospitality venue. Proactive industry audits are routine, with hospitality identified as a high-risk sector for underpayment.
Frequently Asked Questions
From 1 July 2026, the minimum base rate for hospitality workers covered by the Hospitality Industry (General) Award (MA000009) is $26.44 per hour at Level 1. Casual employees receive $33.05 per hour, which includes the 25% casual loading. These rates reflect the Fair Work Commission’s 2026 Annual Wage Review decision, which increased all modern award minimum rates by 4.75%.
Yes. Under the Hospitality Award, permanent employees receive 1.25 times their base rate on Saturdays and 1.5 times on Sundays. Casual employees receive 1.5 times on Saturdays and 1.75 times on Sundays, with the higher multiplier already incorporating the 25% casual loading. A Level 1 casual working on a Sunday earns at least $39.66 per hour.
The 4.75% increase to modern award rates applies from the first full pay period on or after 1 July 2026. If your pay cycle straddles 1 July, the old rates apply until the start of the next full pay period. Employers must not apply 2025-26 rates to any full pay period beginning on or after 1 July 2026.
The casual loading is 25% of the base hourly rate, paid in addition to the classification rate. For a Level 1 employee, this means a base rate of $26.44 per hour becomes $33.05 per hour for casuals. The loading compensates casual employees for not receiving paid leave, notice of termination, or redundancy pay.
Only under a compliant annualised salary arrangement that genuinely compensates for all Award entitlements including penalty rates, overtime, and loadings. Employers must conduct an annual reconciliation to verify the salary covers what the employee would have earned under the Award. If the annualised amount falls short, the employer must pay the difference. A flat rate that is not properly structured is a common cause of underpayment findings by the Fair Work Ombudsman.
Junior employees under 21 are paid a percentage of the adult Level 1 rate: 50% for under-17s, 60% for 17-year-olds, 70% for 18-year-olds, 85% for 19-year-olds, and 100% for employees aged 20 and over. However, juniors aged 18 or over who serve alcohol must be paid the full adult rate for their classification level.
Civil penalties for underpayment under the Fair Work Act 2009 reach $93,900 per contravention for companies and $18,780 for individuals. Each affected employee is a separate contravention, so underpaying multiple staff multiplies the exposure. Since 2025, intentional wage underpayment is a criminal offence carrying up to 10 years’ imprisonment and fines of up to $7.825 million for companies. The Fair Work Ombudsman routinely audits hospitality venues without needing a complaint.
Under s.535 of the Fair Work Act 2009, employers must keep employee records for 7 years, including actual hours worked each day (not rostered hours), pay rates, gross and net amounts paid, deductions, leave balances, and superannuation contributions. Failing to keep accurate records is a separate contravention from any underpayment and compounds total penalty exposure. Payslips must be issued within one working day of payday and include all fields required under the Fair Work Regulations 2009.
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