On 3 June 2025, the Fair Work Commission’s Expert Panel announced the National Minimum Wage and award wages will [increase by 3.5%] (https://ministers.dewr.gov.au/rishworth/national-minimum-wage-rise-35-cent-following-annual-wage-review#) from 1 July 2025. This wage increase follows on from the 2024-25 Annual Wage Review and its recommendations.

This increase in basic pay is great news for Australian workers, especially with the country facing an ongoing cost-of-living crisis.

But how will an increased wages burden affect your small business?

What’s the new minimum wage?

The 3.5% increase will mean that the National Minimum Wage will increase by:

• $0.85 to $24.95 per hour
• $32.10 to $948.00 per 38-hour week
• $1,669.20 to $49,296.00 per year.

How will the wage increase impact your payroll costs?

If your workforce includes a large percentage of employees that are currently on the minimum wage of $24.10, that jump of 85 cents per hour will put extra pressure on your cashflow.

For example, if you’re currently employing 20 people on the minimum wage, and pay them every two weeks, the salary component of your payroll will jump from $36,636 to $37,920. That’s an extra $1,284 on your payroll bill every fortnight – and that’s before you factor in super contributions and other benefits.

Talk to us about preparing for the wage increase

If you’re concerned about the cashflow impact of an increase to the minimum wage, please do come and talk to the team.

We can review the overall effect of the 3.5% rise and suggest ways to mitigate the impact on your payroll costs, cashflow and overall financial position.

t: +61 7 3177 4120
e: advisors@hksrussell.com

Posted on July 1, 2025 by Charisse Russell - Articles