Is salary the same as wages?

In everyday Australian English, 'salary' often refers to a fixed annual amount paid to an employee, while 'wages' are paid by the hour. Legally, both are forms of pay. The Fair Work Act uses 'minimum wage' for hourly or weekly rates. An annual salary can be converted to an hourly rate (divide by 52 weeks and then by 38 hours) to check it meets the relevant minimum.

Does the minimum wage include superannuation?

No. The national minimum wage and award minimum rates are before tax and do not include the superannuation guarantee. From 1 July 2026, employers must pay super of 12% on top of ordinary time earnings, and it must be paid on the same day as wages (payday super).

What if my award rate is lower than the national minimum wage?

From 1 July 2026, the lowest ongoing classification in any modern award cannot be less than the national minimum wage of $26.44 per hour or $1,004.90 per week. Some awards have introductory rates for the first 6 months that can be as low as $25.74 per hour ($978.10 per week). If your award rate seems lower, check the classification and whether you are still in an introductory period. The Fair Work Ombudsman's Pay and Conditions Tool can help.

What Is Salary in Australia? A Guide to Pay Floors and Common Confusions

The national minimum wage from 1 July 2026 is $26.44 per hour ($1,004.90 per week), but most employees are covered by a modern award or agreement that sets a higher rate.

What Is Salary? Understanding Australia's Pay Floors

When people ask "what is salary", they often want to know the minimum they can be paid or how their pay compares to legal standards. In Australia, the answer depends on whether you are covered by a modern award, an enterprise agreement, or are award/agreement-free. This guide explains the different pay floors and how they relate to the term 'salary'.

The Legal Minimum: National Minimum Wage

The Fair Work Commission sets the national minimum wage each year. From 1 July 2026, the rate is $26.44 per hour or $1,004.90 per week for a 38-hour week (the ordinary hours for a full-time employee). This is the base rate for adult employees not covered by an award or registered agreement. Casual employees get an extra 25% loading, making the casual minimum $33.05 per hour.

However, not every worker must receive $26.44 per hour. Junior employees (under 21), apprentices, trainees, and employees with a disability may be paid less under special national minimum wages. For example, a 17-year-old award-free junior is entitled to 57.8% of the adult rate, or $15.29 per hour ($19.11 casual).

Award Rates and Enterprise Agreements

Most employees are covered by a modern award that sets minimum pay rates for their industry or occupation. From 1 July 2026, award minimum wages increased by 4.75%, but the lowest ongoing classification in any award cannot fall below the national minimum wage. Some awards have introductory rates for new employees (limited to the first 6 months) that can be as low as $25.74 per hour.

If you are covered by an enterprise agreement, your base pay rate cannot be less than the relevant award rate. Agreements often provide higher pay or different conditions.

What About 'Salary' vs 'Wages'?

The term 'salary' is often used for annualised pay, while 'wages' refer to hourly rates. Legally, both must meet minimum standards. If you are paid an annual salary, you can check it by dividing by 52 weeks and then by 38 hours to get an hourly equivalent. If that hourly rate is below the award or national minimum, the salary may not be lawful.

Average Earnings: How the Minimum Compares

The Australian Bureau of Statistics (ABS) reported that in May 2026, full-time adult average ordinary-time earnings were $2,083.70 per week. All employees (including part-time and casual) averaged $1,579.20 per week. The national minimum wage of $1,004.90 is about 48% of the full-time average and 64% of the all-employees average. These averages include higher-skilled roles and overtime, so they are not a target for minimum pay.

Superannuation: An Employer Payment on Top

When discussing salary, remember that the superannuation guarantee is an additional cost for employers. From 1 July 2026, the rate is 12% of ordinary time earnings, and it must be paid on the same day as wages (payday super). The minimum wage figures quoted do not include super.

How to Find Your Correct Pay Floor

Use the Fair Work Ombudsman's Pay and Conditions Tool to check your award and classification.
Download the relevant Pay guide from the Fair Work Ombudsman website.
If you are award-free, refer to the national minimum wage order.

For more detailed comparisons and historical rates, see our Which minimum wage applies.

Common Confusions

A common mistake is confusing the national minimum wage with a 'living wage' or 'living wage' survey average. The national minimum is a legal floor, not a median. A negotiated salary can be higher than both the award and the average. Always check your specific situation.

For a full breakdown of junior and apprentice rates, visit our Rate tables.

Tax and Take-Home Pay

The national minimum wage is before tax (gross pay). Tax is withheld by your employer under PAYG. From 1 July 2026, the tax-free threshold applies for residents. Medicare levy of 2% applies once annual income exceeds about $30,000. This site does not provide tax advice; see the Australian Taxation Office for details.

For more about how we compile these figures, see How the figures work.

Summary

In short, "what is salary" in Australia means the pay you receive for work. The legal minimum is set by the Fair Work Commission. The Fair Work Ombudsman explains and enforces it. Always check if you are covered by an award or agreement that sets a higher rate.

For further reading, see our Topics.

FAQs

See the three FAQs above for answers to common questions about salary vs wages, super, and award coverage.

This article is for orientation only. It is not a pay determination or legal advice.