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Published October 25, 2022

What is the Minimum Wage in Australia?

A minimum wage is the lowest amount you can be paid for doing a job.

Thanks to a modern awards system and regular government reviews, Australia has one of the highest minimum wages in the world. That said, it can sometimes be challenging to figure out if you’re being paid enough because the minimum wage Australians are entitled to can depend on several factors.

What does “minimum wage” mean?

A minimum wage is the lowest amount you can be paid for doing a job. It’s your gross pay before tax. It doesn’t include additional entitlements like casual loading, bonuses, allowances and penalty rates — employers must pay these on top of your minimum wage. 

How are minimum wages set in Australia?

Australia’s workplace tribunal, the Fair Work Commission (FWC), reviews the national minimum wage and the industry award rates yearly. It takes into account research findings and input from interested parties like unions, employer groups as well as individuals, then makes a national minimum wage order at the end of its review. Most changes apply from the first full pay period on or after 1 July each year.

Most workers have their minimum wage set out in their award or registered agreement. 

Do all businesses have to pay the minimum wage?

Businesses in the Fair Work system — that is most private sector businesses — have to pay the minimum wage to their employees. 

What is the minimum wage in Australia currently? 

The minimum wage Australian workers are entitled to depends on their type of employment and whether they’re covered by an award or registered agreement.

The national minimum wage for adults

If you’re 21 and over, and an award or a registered agreement doesn’t cover your work, then the national minimum wage of $21.38 per hour or $812.60 per week for a 38-hour week applies.

Special minimum wages

Some employees receive less than the national minimum wage because of their employment type, age or work capacity. 

Apprentices and trainees

Pay rates for apprentices and trainees are often less than the national or award minimum wages for adults. Minimum wage entitlement depends on the training contract, the modern award and other factors, such as:

  • Age of the apprentice or trainee
  • Location of work
  • Stage of apprenticeship or traineeship
  • Level of education of the apprentice or trainee
  • Number of contracted hours
  • Type of work performed.

Apprentices could potentially receive pay increases over time or as they become more skilled.

Young workers

Workers under 21 receive a percentage of an adult’s pay rate as their minimum wage. The applicable award or agreement determines their pay. 

For example, let’s pretend you’re 15 and just started working as an employee at a fast food outlet:

  • Since your main job is to serve customers, you’re covered by the Fast Food Industry Award 2020. 
  • Based on the skills required to perform your duties, you’re likely to be classed as a level 1 fast food employee, and the minimum adult hourly pay for this employee class is $23.38.
  • As a 15-year-old, you’re entitled to 40% of the adult rate, so your minimum hourly wage is $9.35.
  • Your entitlement increases as you age, so if you’re 16, you get 50% of an adult’s pay or $11.69 per hour. 

Employees with a disability

Workers with a disability and reduced capacity to work are paid a Supported Wage System rate, which is a percentage of the pay a person without a disability would get if they were doing the same job. 

Casual employees

Casual employees receive higher pay rates because they’re not entitled to benefits like paid sick leave and annual leave. Their total hourly rate is made up of a fixed hourly rate plus casual loading. 

If you’re a casual worker on the national minimum wage and the casual loading percentage for your award is 25%, then your total hourly wage is $21.38 + $5.35 = $26.73.

Industry awards and registered agreements

Most workplaces are covered by an award. These outline employment conditions like meal or rest breaks and minimum wages for an industry or occupation. Award pay rates are often higher than the national minimum wage, and rates tend to vary depending on the job responsibilities and skills involved. An employee can be covered by more than one award.

  • Examples of industry awards include the Banking, Finance and Insurance Award and the Hospitality Industry Award.
  • Examples of occupation awards include the Architects Award and the Nurses Award.
  • Some workers are covered by a registered agreement, which is FWC-approved and sets out employment conditions. 
  • Jobs that pay for results like commissions or piece rates are typically still covered by an award or agreement.

🤓 Nerdy Tip

Consider income protection insurance, sometimes called IP cover, which pays part of your lost income if you can’t work because of a disability caused by an accident or illness. Think of it like a financial safety net when you’re too sick or injured to work.

How to make sure you are being paid fairly

You can take the following steps to ensure you’re getting the right pay:

  1. Find your minimum pay rate. Award employees can use the Fair Work Ombudsman’s Pay calculator to understand base pay rates, allowances, overtime and penalty rates. If you’re covered by a registered agreement, check the agreement for minimum pay rates. 
  2. Review your payslips. Verify the amounts you received. 
  3. Discuss with your employer. Let your employer know if you believe you’re underpaid.
  4. Lodge a complaint. File a complaint to the Fair Work Ombudsman and include supporting evidence like payslips and timesheets. 

Ways to supplement your minimum wage income

If you’re finding it difficult to make ends meet, here are some ideas on how you can increase your income:

  • Seek advancement opportunities that qualify for a higher pay rate.
  • Ask for additional paid work like overtime.
  • Take up other paid work like childminding or rideshare driver services.
  • Sell items you no longer need. 
  • Check if you’re eligible for financial support, concessions and rebates offered by the state or federal government.
  • Turn a skill, hobby or passion into a side hustle to make extra money in your spare time.

Frequently asked questions about the minimum wage

How does Australia’s minimum wage compare to other countries?

According to research company Statista, Australia had the highest minimum wage of the OECD countries in 2020, once adjusted for purchasing power parity.

What is the minimum wage in Australia for a 16-year-old?

It depends on the applicable award and other factors.

For example, an individual working casually as a shop assistant is covered by the General Retail Industry Award. Their base pay as a level one retail employee is $11.69 (50% x the adult rate of $23.38), but they’ll also receive a casual loading of $2.92, so the total hourly pay rate is $14.61. 

About the Author

Kristie Kwok

Kristie Kwok is a personal finance expert at NerdWallet. She has covered personal and business finance for almost 10 years. She is a qualified chartered accountant and has previous work experience in consumer banking, investment banking and taxation. She also has a Bachelor of Commerce degree, specialising in accounting and finance. Kristie became a writer to combine her passion for words with her in-depth industry knowledge. She is based in Melbourne, Australia.

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