What the 2026 minimum wage increase means for your gross pay, super, and tax

What is the minimum wage increase?

The minimum wage increase is the annual adjustment to the national minimum wage and award wages, determined by the Fair Work Commission. From 1 July 2026, the national minimum wage rose to $26.44 per hour, or $1,004.90 per week for a full-time adult. That works out to an annualised salary of $52,255. On the Salary Index, where 100 is the national line of full-time adult ordinary-time earnings ($108,352 per year), the minimum wage sits at an index of 48.2. That means a minimum wage earner takes home less than half the national benchmark.

How gross pay changes with the increase

The gross pay for a full-time adult on the national minimum wage is straightforward: $26.44 per hour, 38 hours a week, 52 weeks a year gives $52,255. But many workers are covered by modern awards, which set higher minimum rates. Award minima rose by 4.75% from 1 July 2026, so if you're on an award, your gross pay may be above the national minimum. For example, the entry-level award floor is $25.74 per hour – slightly below the national minimum, but most award classifications pay more. The pay guides for your industry will show the exact rate.

Super guarantee on the minimum wage

From 1 July 2026, the super guarantee is 12% of your ordinary-time earnings. For a minimum wage earner on $52,255, that's an extra $6,270.60 paid into your super fund each year. This is on top of your gross pay, so your total remuneration (including super) is $58,525.60. The super guarantee applies to most employees, and the minimum wage is well under the maximum contribution base of $270,830. If you're a casual worker, your casual loading (typically 25%, or $33.05 per hour) is also subject to super. Remember, super is not part of your take-home pay – it's locked away until retirement, but it's a key part of your overall earnings.

Tax on the minimum wage

For the 2026–27 financial year, resident tax rates are: nil on the first $18,200, then 15% on income between $18,201 and $45,000, 30% on $45,001 to $135,000, 37% on $135,001 to $190,000, and 45% above that. Plus a 2% Medicare levy. On $52,255, your tax is calculated as: $0 on the first $18,200, then 15% on $26,800 ($4,020), then 30% on $7,255 ($2,176.50), total tax $6,196.50. Medicare levy adds $1,045.10 (2% of $52,255). So total tax and Medicare is $7,241.60, leaving a take-home of about $45,013.40 per year, or $865.64 per week. This estimate ignores HELP repayments, salary sacrifice, and the Medicare levy surcharge. For a more precise figure, use the ATO's tax calculator.

Where the minimum wage sits compared to states and industries

The national minimum wage index of 48.2 is far below the average for any state or territory. For context, the states with the highest indices are ACT (109.9) and WA (106.9), while Tasmania is lowest at 88.6. Even the lowest state average is nearly double the minimum wage. In industries, retail trade has an index of 75.9 and accommodation and food services 72.5 – still well above the minimum, but many workers in those industries are on award rates that are close to the minimum. The mining industry index is 154.7, more than three times the minimum wage index. These comparisons show how the minimum wage increase affects the lowest-paid workers, who are often in retail, hospitality, and care sectors.

Real-world example: a retail assistant on the minimum wage

Consider a full-time retail assistant covered by the General Retail Industry Award. The award minimum for a Level 1 employee is above the national minimum wage, but for this example, assume they earn exactly the national minimum. Their gross annual pay is $52,255. With 12% super, their employer pays an extra $6,270.60 into super. After tax and Medicare, they take home about $45,013. That's about $865 per week. If they live in NSW, where the state index is 101.2, they are earning far below the state average of $109,658. The minimum wage increase gives them a small raise, but they still rely on the safety net of the minimum wage and award system. For more on how the index works, see how the index works.

What about casuals and juniors?

Casual employees get a loading of at least 25% on top of the minimum wage, so $33.05 per hour. That annualises to $65,319 gross, with an index of 60.3. Junior rates are lower, as shown in the reference: under 16 $9.73/hr, 16 $12.51, 17 $15.28, 18 $18.06, 19 $21.81, 20 $25.83. These are the national minimum percentages, but awards may set different rates. For example, a 17-year-old in hospitality might earn a different junior rate under the Hospitality Award. Always check your award or agreement. The minimum wage increase flows through to junior rates proportionally, so the percentages remain the same.

Summary

The 2026 minimum wage increase sets a new floor of $26.44 per hour. While the gross pay is modest, the addition of 12% super and the tax-free threshold means take-home pay is about $45,000 for a full-time adult. The increase is part of the annual safety net review, and it affects millions of award-covered workers. For a deeper dive into related topics, visit our topics page.