3.5% minimum wage increase from 1 July 2025
Wednesday, 4 June 2025
The Fair Work Commission (FWC) has announced a 3.5% increase to the Australian National Minimum Wage and all modern award minimum wage rates, effective from 1 July 2025. As a result, the National Minimum Wage will increase from $24.10 to $24.95 per hour, translating to an annual wage increase of approximately $1,679 per year for a full time employee.
Also from 1 July 2025, the superannuation guarantee will increase from 11.5% to 12%.
The FWC will shortly publish determinations varying all modern awards to reflect the new national minimum wage order.
By 1 July 2025, each business will need to:
- identify the new minimum rates of pay and allowances for all award-covered employees by reviewing the determinations published by the FWC on the ‘Awards’ page of its website;
- ensure all award-covered employees are paid no less than the new minimum rate of pay for their classification under the applicable modern award; and
- if they pay above-award rates of pay and rely on an award annualised wage arrangement or a contractual set-off to absorb minimum monetary benefits under a modern award, review their arrangements to ensure they remain effective taking into account each employee’s days and hours of work in each pay period.
From 1 January 2025, the intentional underpayment of wages or entitlements has been a criminal offence, and prosecution can result in financial penalties, prison time, or both. The maximum penalty for a knowing or reckless contravention relating to an underpayment for a business with less than 15 employees is $990,000 per contravention, and for a business with 15 or more employees, $4,950,000 or 3 times the underpayment amount per contravention.
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To discuss these or other workplace changes, contact a member of the Employment & Workplace team at Avant Law. Alternatively, call 1800 867 113 or click here to organise a confidential discussion at a time that suits you.
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About the authors
Stephen Schoninger is a Partner and Head of the Employment & Workplace law practice at Avant Law, based in Sydney. Stephen has over 20 years’ experience practising exclusively in employment, industrial relations and discrimination laws. Stephen is called on for his ability to plainly advise on and pragmatically apply legal principles to manage and resolve complex issues arising in the workplace. Stephen advises employers and employees in the private and public sectors on all areas of workplace law and is an experienced litigator of work-related claims. Stephen also conducts workplace investigations and delivers workplace compliance training. He regularly presents seminars on topical employment and workplace law issues.
Savanna Russo is a Senior Associate in the employment and workplace law practice at Avant Law, based in Sydney. Savanna has experience advising both employer and employee clients on all areas of employment law. She has particular experience advising small to medium businesses in a wide range of industries including allied health, banking and finance, professional services and construction. Savanna provides practical, solutions-focused advice and is known for her professional and empathetic approach.
Peter Wrigley is a Senior Associate in the Employment & Workplace law practice at Avant Law, based in Brisbane.
Peter has practiced law for over 8 years’, dedicating much of that time exclusively to employment, discrimination, and industrial relations matters. Peter has appeared in civil and federal courts, administrative tribunals, and the Fair Work Commission to advocate for his clients. With a background in commercial litigation, Peter provides pragmatic advice for settling disputes while acting in the best interest of his clients.
Before joining Avant Law, Peter acted as in-house legal counsel on employment and industrial matters for a national company with services in the maritime and aviation industries. Peter has significant experience in a variety of employment and industrial matters, including workplace investigations, performance management, enterprise bargaining, discrimination, employment contracts, and workplace litigation. Peter has facilitated training and presentations for stakeholders and executive officers on legal reforms and obligations, as well as best practices in the ever-changing space of employment law in Australia.
Natasha Prasad is an Associate in the employment and workplace law practice at Avant Law, based in Sydney. Natasha has experience advising employers and employees on all aspects of employment law areas including workplace discrimination, bullying and sexual harassment, contracts of employment, termination of employment and compliance with employment regulations across various industries. Natasha is dedicated to having an empathetic approach when helping clients navigate complex workplace issues. Natasha provides clear, actionable advice tailored to her client's specific needs.
Disclaimer: The information in this article does not constitute legal advice or other professional advice and should not be relied upon as such. It is intended only to provide a summary and general overview on matters of interest and it is not intended to be comprehensive. You should seek legal or other professional advice before acting or relying on any of this content. The information in this article is current to 5 June 2025. Liability limited by a scheme approved under Professional Standards Legislation. Legal practitioners employed by Avant Law Pty Limited are members of the scheme. © Avant Mutual Group Limited 2024.