What is the difference between a wage and a salary?

A wage is typically paid by the hour or week and often includes penalty rates, overtime, and allowances. A salary is a fixed annual amount divided into regular payments, usually for professional or managerial roles, and may not include overtime. The Fair Work Ombudsman explains that both must meet minimum award or national minimum wage requirements.

Do salaried employees get overtime?

It depends on the award or enterprise agreement. Some salaried roles are paid above the award rate to cover overtime, while others must be paid overtime separately. Check your award or agreement using the Fair Work Ombudsman's Pay and Conditions Tool.

How does superannuation apply to wages and salaries?

Employers must pay superannuation guarantee contributions of 12% on top of ordinary time earnings for both wage and salary employees. From 1 July 2026, super must be paid on the same day as wages (payday super). This is an employer payment on top of your gross pay.

Wage vs Salary: Understanding the Difference and Your Minimum Entitlements

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

Wage vs Salary: What’s the Difference?

In Australia, the terms “wage” and “salary” are often used interchangeably, but they have distinct meanings in employment law and practice. A wage is usually calculated on an hourly or weekly basis and is common in industries like retail, hospitality, and construction. A salary is a fixed annual amount paid in regular instalments, typically for professional, administrative, or managerial roles. The key difference lies in how overtime, penalty rates, and allowances are handled. Wage earners are generally entitled to overtime and penalty rates under their award, while salaried employees may have these built into their annual package if they are paid above the award rate.

The Legal Minimum Pay Floor

Every employee in Australia is entitled to a minimum wage. The Fair Work Commission sets the national minimum wage each year, which applies to employees not covered by a modern award or enterprise agreement. As of 1 July 2026, the national minimum wage is $26.44 per hour or $1,004.90 per week for a 38-hour week . Casual employees receive a 25% loading, bringing their minimum to $33.05 per hour.

However, most employees are covered by a modern award that sets higher minimum pay rates. From 1 July 2026, award minimum wages increased by 4.75%, with the lowest ongoing classification at least $26.44 per hour or $1,004.90 per week. Some awards have introductory rates for new employees (limited to the first six months) at $25.74 per hour or $978.10 per week .

Who Can Be Paid Less?

Not every worker must receive $26.44 an hour. The Fair Work Commission allows lower rates for:

Junior employees (under 21) – percentages of the national minimum wage, e.g., a 16-year-old gets $12.51 per hour (47.3%).
Apprentices and trainees – rates are set under the Miscellaneous Award.
Employees with disability – a supported wage based on productivity.
Introductory award rates – limited to the first six months.

If you are award-free and agreement-free, the national minimum wage applies. But if a modern award or enterprise agreement covers you, that document’s rates take precedence and are almost always higher.

Award Rates vs Negotiated Salaries

A modern award is a legal document that sets minimum pay and conditions for an industry or occupation. For example, the Hospitality Industry General Award sets different rates for different classifications. An enterprise agreement is a negotiated document between an employer and employees (or their union) that can provide better conditions than the award. A negotiated salary is an individual arrangement, often above the award rate, that may include additional benefits like a car allowance or bonus.

The Fair Work Ombudsman’s Pay and Conditions Tool can help you find the correct award and classification .

Superannuation: An Employer Payment on Top

When discussing pay, it’s important to remember that superannuation is an employer contribution on top of your gross wage or salary. From 1 July 2026, the super guarantee rate is 12% of ordinary time earnings, and employers must pay it on the same day as wages (payday super). This means your total remuneration package includes both your cash pay and super.

How Your Weekly Pay Compares

The Australian Bureau of Statistics (ABS) reports that full-time adult ordinary-time earnings averaged $2,083.70 per week in May 2026. This is roughly double the national minimum wage of $1,004.90. However, many award rates sit between these figures. For example, a retail employee Level 1 might earn around $1,100 per week, while a registered nurse might earn $1,800 per week. Your actual pay depends on your award classification, experience, and any enterprise agreement.

Tax and Medicare

Your gross pay is subject to PAYG withholding tax and Medicare levy (2% once annual income exceeds $30,000). The tax-free threshold means the first $18,200 is tax-free. Use the ATO’s tax tables to estimate your net pay. This site does not provide tax advice.

Summary

Wage = hourly/weekly pay, often with overtime and penalties.
Salary = annual fixed pay, may include overtime in the package.
Legal minimum = national minimum wage ($26.44/h) or higher award/agreement rate.
Super = 12% on top, paid by employer.
Average earnings = $2,083.70/week for full-time adults (ABS).

For more detail, see our Which minimum wage applies guide and Rate tables.

For the published floors, see the rate tables and how the figures work.