Every year, the Fair Work Commission's Annual Wage Review decision sets the new minimum rates for every modern award in Australia. Every year, employers leave it until the last minute. And every year there is a scramble to get payroll updated in time.
The 2026 decision is expected in the first two weeks of June. New rates take effect from the first full pay period on or after 1 July 2026.
If you employ workers under the Pastoral Award (MA000035) or the Horticulture Award (MA000028), here is how to get ahead of it.
Who is affected
The decision flows through to every classification under both awards. That includes:
- Full-time and part-time farm workers at every level
- Casual workers (with the 25 per cent casual loading applied)
- Seasonal and harvest workers
- Piece-rate workers (because piece rates must average at least the minimum hourly rate)
- Apprentices and trainees (at the relevant percentage of the adult rate)
- Junior workers (at the relevant junior percentage)
If you are employing in any of those categories, the rate goes up.
The numbers (current and expected)
Current minimum rates under the Pastoral Award (Farm and Livestock Hand Level 1, the entry-level classification, effective 1 July 2025):
One thing worth flagging: since April 2025, Farm and Livestock Hand Level 1 is only for workers in their first 3 months in the industry. Most of your team should be on FLH Level 2 ($24.95/hr full-time, $31.19/hr casual) or higher. Misclassification is a common compliance gap.
In 2025, the FWC awarded a 3.5 per cent increase. If 2026 mirrors that, projected FLH 1 rates would land at approximately:
Horticulture Award (MA000028) rates sit at the same Level 1 base ($24.28/hr full-time) and move similarly. Higher classifications, piece rates and allowances all index proportionally. The actual numbers will be confirmed when the FWC decision is published.
What to do before the decision lands
You have about three weeks. Use them.
- Pull your current payroll classifications. For every employee, write down which award they are under, what classification, and what hourly rate. Set this aside as your "before" baseline.
- Identify your piece-rate workers. Piece rates must average at least the minimum hourly rate across the pay period. If you have piece-rate workers, you will need to recalculate the equivalent hourly rate the moment the new minimum drops.
- Check your payroll system. If you use Xero, MYOB, KeyPay, or any award-aware system, confirm it will auto-update when the FWC decision is published. Most do, but some require a manual update.
- Flag any underpayment risk now. If you suspect you have been underpaying (wrong classification, missed allowances, casual rates not loaded properly), fix it now. Do not carry that into a new rate cycle. Fair Work Ombudsman investigations look back six years.
What to do when the decision drops
You will get a three-week window between the announcement (early June) and the effective date (1 July).
- Update your rates in payroll. For every classification, plug in the new minimum. If your payroll software auto-updates, verify it pulled in correctly.
- Recalculate piece rates. Make sure your piece-rate equivalents still average at least the new minimum.
- Communicate to staff. A quick written note: "Your hourly rate increases from $X to $Y effective from the first pay period on or after 1 July, in line with the Fair Work Commission's Annual Wage Review." Done.
- Check allowances. Award allowances (meal, tools, remote location, district allowance) typically index alongside the wage. Make sure these have updated too.
What to do straight after 1 July
- Verify the first new pay run. Eyeball the first pay run after 1 July. Are the new rates flowing through correctly? Are casual loadings applied to overtime? Are allowances right?
- Lock down your classifications. This is a good moment to do a classification audit. If you have workers in the wrong classification, fixing it now is much cheaper than fixing it after a Fair Work claim.
- Update your contracts where relevant. If your employment contracts reference specific rates rather than "the applicable award rate", update them.
The risk is not the wage increase itself. It is the gap between the decision and the effective date. Three weeks is tight, especially mid-season or with multiple payrolls. The employers who get caught out are not malicious. They just do not have a system to handle the changeover.
A note on piece rates and seasonal workers
The Fair Work Ombudsman has horticulture piece rates listed as an active enforcement priority. If you employ piece-rate workers, this is the year to make sure you have it right.
The minimum guarantee: piece rates must result in pay equivalent to at least the minimum hourly rate (plus the 25 per cent casual loading for casuals), averaged across the pay period. If a worker spends 8 hours picking and the piece rate output is less than 8 multiplied by the minimum hourly rate, you owe them the difference.
Most underpayments here happen because employers do not track hours worked. Without hours, you cannot prove the piece rate is meeting the minimum. Track hours. Always.
Bottom line
The Annual Wage Review is not optional and the timeline is fixed. Three weeks from decision to effective date. The employers who do not get caught out are the ones who set up before the decision lands.
Related reading: Are you paying your farm workers correctly? (the classification errors that cause most underpayment) and Payday Super is landing 1 July 2026 (the other major payroll change hitting on the same day).