What is the first step in how to negotiate a salary package?

The first step is to know the legal minimum that applies to your job. Check whether you are covered by a modern award or enterprise agreement, because those documents set a minimum pay rate that is often higher than the national minimum wage. The Fair Work Ombudsman’s Pay and Conditions Tool can help you find the correct award and classification.

Can I be paid less than the national minimum wage if I am under 21?

Yes, if you are award‑free and under 21, the special national minimum wage for juniors applies. For example, a 17‑year‑old award‑free employee is entitled to 57.8% of the adult rate, which is $15.29 per hour from 1 July 2026. However, if you are covered by an award, the award’s junior rates apply instead. Always check your award or agreement first.

How does superannuation affect my salary package?

Superannuation is an employer contribution on top of your ordinary time earnings. From 1 July 2026 the super guarantee rate is 12%. When negotiating a salary package, remember that the advertised salary is usually before super. Your total remuneration includes the base salary plus the super contribution, which is not paid to you directly but into a super fund.

How to Negotiate a Salary Package: Know Your Minimum Wage and Benchmark Rates

The national minimum wage from 1 July 2026 is $26.44 per hour, but award rates and enterprise agreements can require higher pay.

How to negotiate a salary package: start with the legal floor

When you are thinking about how to negotiate a salary package, the first thing to do is find out the minimum pay that your employer must legally give you. This is the floor below which no offer should fall. For most employees in Australia, that floor is set by a modern award or an enterprise agreement, not by the national minimum wage.

The Fair Work Commission reviews the national minimum wage each year. From 1 July 2026 the adult rate for award‑free employees is $26.44 per hour, or $1,004.90 for a 38‑hour week. Casual employees get a 25% loading, making it $33.05 per hour. But these rates are the absolute minimum for workers not covered by any award or agreement. If you are covered by an award, the lowest ongoing classification in that award must be at least $26.44 per hour, and any introductory rate limited to the first six months must be at least $25.74 per hour.

Separate the legal minimum from the market rate

Knowing the legal minimum is only the starting point. The next step in how to negotiate a salary package is to understand what other people in similar roles are earning. The Australian Bureau of Statistics (ABS) publishes average earnings figures. In May 2026, full‑time adult ordinary‑time earnings averaged $2,083.70 per week, and the average total earnings across all employees (including part‑time and casual) was $1,579.20 per week. Dividing that by 38 ordinary hours gives an hourly equivalent of about $41.56. This is well above the national minimum and can be a useful benchmark when you have a specific job offer.

Award rates sit between the national minimum and the ABS averages. For example, a retail employee Level 1 under the General Retail Industry Award will have a minimum rate that is higher than $26.44 but lower than the average. You can check the exact rate for your classification using the Fair Work Ombudsman’s Pay and Conditions Tool or by downloading the relevant pay guide from Which minimum wage applies or Rate tables.

Negotiate the whole package, not just the hourly rate

A salary package is more than the base hourly or weekly wage. When you negotiate, consider:

Superannuation: From 1 July 2026 employers must pay 12% super on top of your ordinary time earnings. This is not deducted from your salary; it is an extra cost to the employer. If an employer offers you $70,000 a year, the total cost to them is $78,400 including super.
Penalty rates and allowances: Awards and agreements often include extra pay for weekend work, overtime, or specific tasks. These are separate from the base rate.
Leave and other conditions: Annual leave, personal leave, and rostered days off all add value to a package.

When you compare offers, convert everything to a total remuneration figure. The legal minimum only covers the base rate; a good negotiation will address the full package.

What if you are award‑free and under 21?

Award‑free junior employees have their own special minimum wages. For example, a 17‑year‑old gets 57.8% of the adult national minimum, which is $15.29 per hour. A 20‑year‑old gets 97.7%, or $25.84 per hour. These rates are lower than the adult minimum, but they still form the legal floor for that age group. If you are covered by an award, the award’s junior rates apply instead.

Enterprise agreements can set higher rates

If your workplace has an enterprise agreement, the base pay rate in that agreement cannot be less than the base rate in the relevant award. Many agreements offer above‑award wages. You can find enterprise agreements on the Fair Work Commission’s website. When negotiating, ask whether the employer is covered by an agreement and request a copy of the pay schedule.

Practical check: compare your hourly rate

Use the chart above to see where your current or offered hourly rate sits relative to the national minimum ($26.44) and the average total earnings ($41.56). If your rate is below the award minimum for your classification, you are being underpaid. If it is above the average, you are doing well. Most salaries fall between the two.

For more detail on how the figures are calculated, see How the figures work. For a broader overview of pay topics, visit Topics.

Remember: the Fair Work Ombudsman explains and enforces the law, but the Fair Work Commission sets the national minimum wage. This site does not provide legal advice. If you are unsure about your entitlements, contact the Fair Work Ombudsman or a qualified employment lawyer.