FWC Annual Wage Review: National Minimum Wage and Award Increases

The statutory framework

The Fair Work Act 2009 establishes the legal basis for the Annual Wage Review. Section 285 mandates that the Fair Work Commission (FWC) Expert Panel undertakes and finalises this review in each financial year. The Expert Panel’s composition is defined in s 620, comprising the FWC President, two other FWC members, and three part-time expert members.

The Panel’s decision-making process is guided by the minimum wages objective outlined in s 284. This objective requires consideration of factors including economic performance, social inclusion, living standards, equal remuneration, and the impact on employment and business. Modern awards system Australia are also relevant to this process.

When adjusting minimum rates within Modern awards system Australia, the Expert Panel must give due weight to the Modern Awards Objective as detailed in s 134.

What the review produces

The Annual Wage Review produces two key instruments. These are a National Minimum Wage Order, established under s 285(2)(c), which determines the national minimum wage for employees not covered by an award or agreement, and variations to minimum wages within the Modern awards system Australia under s 285(2)(b).

The review also mandates the setting of special national minimum wages. These apply to specific employee categories, including junior employees, apprentices, trainees, employees participating in training arrangements, and employees with a disability.

The outcome of the Annual Wage Review is published each year in early to mid-June. The changes then take effect from the first full pay period commencing on or after 1 July.

Process and submissions

The Fair Work Commission (FWC) undertakes a structured process to determine annual wage adjustments. This includes a research and statistical program, the issuance of directions for submissions, and consultations with peak bodies. These bodies include the Australian Council of Trade Unions (ACTU), the Australian Industry Group (Ai Group), the Australian Chamber of Commerce and Industry (ACCI), and the Council of Small Business Organisations Australia.

An Expert Panel is appointed to consider the submissions and evidence. The Panel typically conducts a consultation hearing in May, before publishing its decision in early June. The decision is documented in a published written decision under s 287, outlining the Panel's reasoning.

The National Minimum Wage Order and any associated award variations take effect from the first full pay period on or after 1 July of the relevant year.

Recent decisions and effect

The Annual Wage Review 2023-24, announced on 3 June 2024, resulted in a 3.75% increase to the National Minimum Wage and minimum wages outlined in Modern awards system Australia. These new rates took effect from the first full pay period on or after 1 July 2024, with the National Minimum Wage set at $24.10 per hour or $915.90 per 38-hour week.

The Annual Wage Review 2024-25, announced on 3 June 2025, implemented a further increase of 3.5% to the National Minimum Wage and modern award minimum wages. This increase also applied from the first full pay period on or after 1 July 2025, establishing a National Minimum Wage of $24.95 per hour or $948.00 per 38-hour week.

Employers are required to implement these wage increases from the specified commencement dates. Failure to do so may result in underpayment recovery actions under Part 4-1 of the relevant legislation, alongside potential civil penalties. The next Annual Wage Review decision, anticipated in early June 2026, will determine rates effective from 1 July 2026.