The Minimum Wage Increases on 1 July 2026 — Here’s Your Employer Action List
Two of the most significant payroll changes in years hit on the same date: 1 July 2026. The Fair Work Commission has confirmed a 4.75% increase to all modern award minimum wages, and the ATO’s Payday Super reform simultaneously changes how and when employers must pay superannuation. If you haven’t already reviewed your payroll, you’re cutting it close.
Here’s exactly what you need to know and do as an employer before the deadline.
What Is the Minimum Wage Increase for July 2026?
The Fair Work Commission’s Annual Wage Review 2026 panel handed down its decision on 2 June 2026, announcing a 4.75% increase to all minimum award rates under modern awards. Separately, the National Minimum Wage (NMW) — which applies to employees not covered by a modern award or enterprise agreement — increases by approximately 6%.
The new rates from 1 July 2026 are:
| Rate Type | New Rate (from 1 July 2026) |
|---|---|
| National Minimum Wage (hourly) | $26.44 per hour |
| National Minimum Wage (weekly) | $1,004.90 per week |
| Modern award minimum increase | 4.75% on all award rates |
| Lowest ongoing employment rate (C13) | $1,004.90 per week / $26.44 per hour |
The increase takes effect from the first full pay period on or after 1 July 2026. That means if your pay period begins on 30 June, the new rates don’t apply until the next pay period. However, if your pay period starts on 1 July or later, the new rates apply immediately.
Who Does the Minimum Wage Increase Apply To?
The 4.75% increase applies to all employees covered by a modern award. According to the Fair Work Commission, modern award-reliant employees represent approximately 21.1% of the national workforce — about 2.8 million workers.
- Full-time and part-time award-covered employees — their hourly and weekly rates must increase by 4.75%
- Casual employees — their base rate increases by 4.75%, and their 25% casual loading is calculated on the new base rate
- Junior employees and apprentices — rates set as a percentage of the adult minimum rate will automatically recalculate
What If You Pay Above Minimum Rates?
Many employers pay above the award minimum — either through individual contracts, annualised salary arrangements, or simply as a business practice to attract and retain staff. Even so, you are not necessarily exempt from this review.
Payday Super — What Starts on 1 July 2026
Alongside the wage increase, the ATO’s Payday Super reform takes effect on 1 July 2026. This is a significant change to how superannuation guarantee contributions work in Australia.
Currently: Employers pay superannuation quarterly — within 28 days of the end of each quarter (October, January, April, July).
From 1 July 2026: Employers must pay superannuation to the employee’s nominated super fund within 7 days of each payday. There is no longer a quarterly payment option.
This change has major implications for cash flow and payroll systems:
- If you pay weekly, you must remit super weekly
- If you pay fortnightly, super is due fortnightly
- Payroll software must be configured to calculate and remit super on each pay run
- Single Touch Payroll (STP) reporting requirements change — both wages and super liability must now be reported each payday
Failure to comply with Payday Super will result in a Superannuation Guarantee Charge (SGC) levied by the ATO, plus interest and administration fees. These are not tax-deductible. The ATO has indicated it will be actively monitoring compliance from 1 July 2026.
Key Takeaways for Employers:
- ✔ All modern award minimum wages increase 4.75% from 1 July 2026
- ✔ New National Minimum Wage: $26.44/hour or $1,004.90/week
- ✔ Applies from the first full pay period on or after 1 July 2026
- ✔ Review enterprise agreements — award rates must not exceed EA rates
- ✔ Annualised salary arrangements must be recalculated
- ✔ Payday Super begins 1 July 2026 — super must be paid within 7 days of each payday
- ✔ Update payroll software and STP configuration before 30 June
Your Minimum Wage Increase July 2026 Employer Checklist: 7 Steps to Take Now
- Identify which modern award(s) cover your employees. Not sure? The Fair Work Ombudsman’s award finder at fairwork.gov.au can help. Getting this wrong is the single most common payroll compliance failure.
- Look up the new award rates for each classification. Updated pay guides for every modern award will be published by the Fair Work Ombudsman from 1 July. Cross-check each employee’s rate against their award classification.
- Check your enterprise agreement (if applicable). Confirm that the EA rates still exceed the new modern award minimums for every classification. If any EA rate falls below the award, the award rate automatically applies — but you need to update your payroll to reflect this.
- Recalculate annualised salary arrangements. Run the numbers using the new award rates, including overtime, penalty rates, allowances, and loadings. Document the calculation and keep records as required under the Fair Work Act 2009.
- Update your payroll software. Contact your payroll provider or confirm your software has updated award rate tables from 1 July. For Payday Super, confirm your software can calculate and remit super on each pay run and update STP reporting accordingly.
- Notify employees of any pay changes. While not always legally required, notifying employees of rate changes is good practice and reduces confusion and disputes.
- Review pay slips. From 1 July, pay slips must accurately reflect the new rates. Incorrect pay slips are a Fair Work Act breach in themselves.
What Happens If You Don’t Comply?
Paying employees below the new minimum award rates from 1 July 2026 is underpayment of wages under the Fair Work Act 2009. The consequences are real:
- Fair Work Ombudsman investigations and compliance notices
- Back-pay orders for the underpayment (plus interest)
- Civil penalties of up to $18,780 per breach for individuals or up to $93,900 per breach for corporations
- From 1 January 2025, intentional underpayment is a criminal offence — carrying up to 10 years imprisonment and fines of up to $7.8 million for corporations
Specific Awards Employers Should Check Now
With over 120 modern awards in the national system, almost every industry is affected. These are some of the most commonly relied-upon awards for small and medium employers:
| Award | Commonly Covers |
|---|---|
| Clerks — Private Sector Award | Office admin, receptionists, data entry |
| General Retail Industry Award | Retail sales, cashiers, stock room |
| Restaurant Industry Award | Cafes, restaurants, fast food |
| Hospitality Industry Award | Hotels, accommodation, bars |
| Health Professionals Award | Allied health, medical practices |
| Professional Employees Award | Engineers, accountants, IT professionals |
If you’re not certain which award applies to your employees, or you’re unsure whether your annualised salary absorbs all entitlements, now is the time to get advice — not after 1 July.
Need help reviewing your award obligations before 1 July?Fair Work Centre members get direct access to dedicated employment lawyers who can review your payroll obligations, identify exposure, and walk you through the changes — without the $500/hour price tag of traditional legal advice.
Frequently Asked Questions
The 4.75% minimum wage increase takes effect on 1 July 2026. From that date, the National Minimum Wage rises to $24.10 per hour (up from $23.00). Modern Award minimum rates increase by the same percentage. Employers must update pay rates for all employees on or before 1 July 2026 — back-pay obligations apply if you miss the date.
All employees covered by the national workplace relations system are affected — including full-time, part-time, and casual employees paid at or near the minimum rate under a Modern Award or the National Minimum Wage. Employees on individual contracts above the award rate may not require an immediate increase, but their contracts must still meet the new minimums.
Payday Super requires employers to pay superannuation contributions at the same time as wages — rather than quarterly. It starts 1 July 2026. Employers who fail to pay super with every pay run will face the Superannuation Guarantee Charge, which includes the shortfall, interest, and an administration fee. This is a significant cash flow change for businesses that currently batch super payments quarterly.
Failure to pay employees at or above the new minimum rates from 1 July 2026 constitutes underpayment under the Fair Work Act 2009. The Fair Work Ombudsman can require back-payment of the difference, plus interest. In cases of deliberate underpayment, penalties can reach $18,780 per contravention for individuals and $93,900 per contravention for companies. Criminal wage theft provisions also apply in some states.
You do not need to reissue employment agreements each time the minimum wage increases — provided your agreement references the applicable Modern Award rate (which updates automatically). However, if your contract states a fixed dollar rate that is now below the new minimum, you must either update the agreement or the employee’s pay. Agreements that lock in a rate below the legal minimum are void to that extent.
Part-time employees receive the same hourly rate as full-time employees on a pro-rata basis. Casual employees receive the base hourly rate plus the 25% casual loading. From 1 July 2026, the base rate is $24.10/hour, making the minimum casual rate $30.13/hour. Always check the applicable Modern Award — many awards set rates above the National Minimum Wage for specific classifications.
