As an employee, there is a minimum amount you can be paid for performing a specific job, known as the minimum wage. This refers to the base hourly or weekly rate you are entitled to receive. In Australia, the minimum wage does not include any bonuses, penalty rates, casual loading, or superannuation. In this article, we will explain the Australian minimum wage for employees, covering what it is and how it varies across different industries and for various individuals.
Table of Contents
What is the Minimum Wage in Australia?
The minimum wage is the lowest amount an employer can legally pay an employee for their work. In Australia, the Fair Work Commission (FWC) sets the national minimum wage. As of 1 July 2023, this rate is $23.23 per hour, which equates to $882.80 per week for a standard 38-hour work week, or $45,905.60 annually for a full year of work.
The minimum wage aims to protect workers from being paid unfairly low wages. It ensures that employees receive a basic living wage and promotes a fair distribution of profits and revenue. By setting a floor for wages, the minimum wage helps reduce poverty and supports greater equality by advocating for equal pay for work of equal value.
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| What is Leave Loading? |
| Australia Youth Allowance Rates |
| SCHADS Award Rates |
| Australia Public Holidays 2024 |
The National Minimum Wage
The national minimum wage in Australia sets the minimum base pay for any job, with a few exceptions. These exceptions include:
- Junior workers (under 21 years old)
- Employees under the Supported Wage System
- Apprentices and trainees
For all other employees, it is illegal to be paid less than the national minimum wage. As of 1 July 2023, the national minimum wage in Australia is $23.23 per hour or $882.80 per week (before tax). Casual employees who are covered by the national minimum wage receive an additional 25% on top of their base rate.
Minimum Wage in Australia for 16 Years Old and 16+
People younger than 21 have to pay a different minimum wage in Australia. A percentage of the national minimum wage is used to figure out the minimum pay for young workers:
| Age | Percentage | Hourly Minimum Wage |
|---|---|---|
| Under 16 | 36.8% | $8.55 |
| 16 | 47.3% | $10.99 |
| 17 | 57.8% | $13.43 |
| 18 | 68.3% | $15.87 |
| 19 | 82.5% | $19.16 |
| 20 | 97.7% | $22.70 |
Changes to the Minimum Wage
Every year, the Fair Work Commission conducts an Annual Wage Review to assess whether the national minimum wage and award wages should be increased. This process takes place from March to June, with any changes coming into effect on July 1.
The specific minimum wage applicable to an individual can vary based on factors such as the industry they work in and their age, among other considerations, which are detailed further below.
Award Wages Less than the National Minimum Wage
Following the 2023 Annual Wage Review decision, the minimum award wages in certain awards might now be lower than the national minimum wage. For example, some awards have initial pay rates for new employees in their industry, typically applicable for a limited time until the employee progresses to the next level. If an employee is covered by an award or agreement, the minimum wage specified in the award will take precedence over the national minimum wage.
Commission Payments and Piece Rates
Some employees get paid for the work they have done rather than according to the hours they work. Often these employments are still covered by an award, but even if they are not, your employer must pay you at a rate that is equivalent to or higher than the national minimum wage.
Casual Wages
Casual employees covered under the national minimum wage receive an additional pay of at least 25% of the hourly rate of pay. It is paid because casuals don’t have access to paid leave entitlements. Casual workers hired under certain awards may be entitled to a higher rate. Workers might also be covered by a contract of employment that can outline a higher rate of pay.
The Supported Wage System
The Supported Wage System is applicable for employees with a disability that affects and reduces their ability to work. If you are on the Supported Wage System, your minimum wage is calculated as a percentage of what other employees without a disability would earn if they were doing the same job.
It depends on the Department of Social Services to decide if you should be paid a Supported Wage System rate – your employer won’t be able to decide this. It depends on the Department of Social Services to check your ability and decide what rate you should be paid.
Apprenticeships and Traineeships
Different minimum wages are applied to employees under a registered training agreement, like a traineeship or apprenticeship. These minimum wages depend on the type of job you are doing and your age. Based on the type of work you do, your minimum wage might also increase the longer you spend there. It might also increase when you get better at doing your job.
Superannuation
Employers are required to pay an 11% super contribution to their employees based on their ordinary time earnings and who are aged 18 or above, or are under 18 and work over 30 hours a week. However, it may increase gradually to 12% by 2025.
Conclusion
Now that you know the minimum wage in Australia according to different age groups, you can check which category you fall into. For more detailed tax information, you can reach out to Reliable Melbourne Accountants.
FAQs
What is the minimum wage for a 17-year-old in Australia?
17 years of age: 57.8% of national minimum wage = minimum hourly rate of $13.43. 18 years of age: 68.3% of national minimum wage = minimum hourly rate of $15.87. 19 years of age: 82.5% of national minimum wage = minimum hourly rate of $19.16.
How much does a student make in Australia?
The average student salary in Australia is $80,933 per year or $41.50 per hour. Entry-level positions start at $68,760 per year, while most experienced workers make up to $113,777 per year.
What is the lowest salary in Australia?
The national minimum wage sets how much an employer who is in the national system can pay an employee. From 1 July 2024, the national minimum wage is $915.90 based on a week of 38 ordinary hours ($24.10 per hour).