Minimum wage increase July 2026: What employers must know

The Fair Work Commission has handed down its 2026 Annual Wage Review decision. From 1 July 2026, the National Minimum Wage and all modern award minimum wage rates will increase by 4.75%.

This is larger than the 3.50% increase in 2025 and the 3.75% increase in 2024. The decision will directly affect around 21.1% of the workplace who are paid at the applicable minimum wage or award rate.

Here’s what you need to know and what to do before the changes take effect. 

What's changing

From 1 July 2026, the National Minimum Wage will increase by 4.75%. The lowest rate in any award that applies to ongoing employment must be at least $1,004.90 per week or $26.44 per hour. Entry-level rates that apply for the first six months or less of employment must be at least $978.10 per week or $25.74 per hour. 

The Commission has also made additional adjustments for the lowest-paid classifications in the award system, aimed at protecting workers classified at the C13 and C14 levels. It estimated the change would affect around 100,000 of the lowest-paid employees. 

Wage rates in remaining transitional instruments and copied State awards will also rise by 4.75%, taking effect from the first pull pay period on or after 1 July 2026.

When does it apply

The new National Minimum Wage will apply from the first full pay period on or after 1 July 2026. This means if your weekly pay period starts on Wednesday, the new rates will apply from Wednesday 1 July 2026. 

Which industries are most affected?

The increase will have a larger impact on industries more reliant on awards, including health care and social assistance, retail trade, accommodation and food services, and administration and support services, which includes labour hire workers.

What employers need to do

Employers who pay their employees at minimum wage rates under modern awards or the National Minimum Wage will be required to increase their employees’ rates of pay from 1 July 2026. 

Employers who pay their employees under an enterprise agreement should review the rates under that instrument to ensure they are equal to or above the applicable minimum wage rates. Employers who pay above the minimum wage and utilise set-off clauses or annualised wage arrangement should also review and assess the impact of the increases, in particular, whether increases can be absorbed without changes or whether adjustments to remuneration arrangement are necessary. 

In practical terms, before 1 July you should:

• Check that all employees paid at award rates are updated to reflect the new minimums. 
• Review any enterprise agreements to confirm rates remain compliant. 
• Check annualised salary arrangements to ensure they still sit above the new minimums. 
• Update any payroll configurations ahead of the first full pay period on or after 1 July. 

How Microkeeper handles it

The 4.75% increase applies to all modern award minimum wage rates from 1 July 2026. If your employees are paid at award rates, you’ll need to update your pay configurations in Microkeeper ahead of the first full pay period on or after 1 July. Microkeeper’s automated payroll software makes it straightforward to apply rate changes across your workforce once you’re ready to update.

If you’re unsure how to update your rates or how the changes affect your specific setup, our support team is available by phone and ticket and can walk you through it.