Meal Entertainment Card Salary Packaging: How It Affects Your Minimum Wage

Meal Entertainment Card Salary Packaging and the Minimum Wage

Meal entertainment card salary packaging is a common benefit offered by not-for-profit employers in Australia. It allows employees to use pre-tax salary to pay for meals and entertainment, reducing their taxable income. However, this arrangement does not change the fundamental requirement that you must be paid at least the legal minimum wage. This guide explains how salary packaging interacts with pay floors, award rates, and the super guarantee.

The Legal Minimum Wage Still Applies

The Fair Work Commission sets the national minimum wage, which from 1 July 2026 is $26.44 per hour or $1,004.90 per week for a full-time adult employee. This is the minimum cash amount (or total remuneration including benefits) that an employer must pay. Salary packaging is a voluntary arrangement; it cannot reduce your gross wage below this floor. If you are covered by a modern award, the award rate may be higher and must be paid. For award-free employees, the national minimum wage applies, but junior, apprentice, and supported wage rates may be lower as specified by law.

How Salary Packaging Works

When you salary package a meal entertainment card, you agree to forgo part of your pre-tax salary in exchange for the benefit. Your employer then provides the card, which you can use for eligible meals and entertainment. The packaged amount is deducted from your gross salary before tax, lowering your taxable income. However, your employer must still ensure that the total value of cash plus benefits meets the minimum wage requirement. The Fair Work Ombudsman explains that salary packaging does not allow an employer to pay less than the minimum wage.

Super Guarantee on Top

Employers must pay the super guarantee of 12% on your ordinary time earnings. This is calculated on your salary before any salary sacrifice for benefits like meal entertainment cards, unless the sacrifice is for super contributions. So even if you package part of your salary, your super contributions are based on your pre-sacrifice earnings. This is an additional cost for employers on top of your wage.

Award and Agreement Rates Can Be Higher

If you work under a modern award or an enterprise agreement, the minimum rate in that instrument applies. Salary packaging cannot be used to circumvent award rates. For example, if your award rate is $28 per hour, you must receive at least that amount in cash or total remuneration. The meal entertainment card is an extra benefit, not a substitute for the minimum wage. Always check your award or agreement for specific provisions about salary packaging.

Comparing Your Rate to the Floor

To see how your pay compares with the legal minimum, refer to the Which minimum wage applies page for guidance. If you are award-free and adult, the national minimum wage of $26.44 per hour (or $33.05 casual) is the floor. If you are a junior, the percentages in the reference apply. For example, a 17-year-old award-free employee must receive at least $15.29 per hour ($19.11 casual). Salary packaging does not change these minimums.

Market Rates Are Not in This Reference

This site does not have a specific market rate for meal entertainment card salary packaging. The value of such packaging varies by employer and FBT rules. For precise figures on typical packaging amounts, consult your employer or a salary packaging provider. The legal minimum wage remains the only guaranteed floor.

FAQs

See the FAQs above for common questions about salary packaging and minimum wage.

Further Reading

For more details on pay rates and how they are set, visit our Rate tables page. You can also learn about the methodology behind these figures on the How the figures work page.

Note: This guide is for orientation only. It is not a pay determination, tax advice, or legal advice. Always refer to the Fair Work Ombudsman for enforcement and the Australian Tax Office for salary packaging rules.