TimesheetGuidesSuper and packaging
How to Negotiate a Salary Package: From Hourly Rate to Annual Pay
Annual gross pay is your hourly rate × hours per week × 52, assuming a standard 38-hour week for full-time employees.
How to Negotiate a Salary Package: Understanding Your Hourly Rate
Knowing how to negotiate a salary package starts with understanding the true value of your hourly rate. Whether you’re offered a job at $30 per hour or a flat annual salary, you need to convert that figure into a yearly amount to compare apples with apples. The basic formula is:
Annual gross pay = hourly rate × hours per week × 52
For full-time employees, the standard week is 38 hours. So a $30 per hour rate gives you $30 × 38 × 52 = $59,280 per year. This assumes the same rate every week, no unpaid overtime, and no penalty rates or allowances. It’s a starting point for negotiation.
Why 38 Hours Matters
The Fair Work Ombudsman uses 38 hours as the ordinary full-time week under most awards. When you see a salary offer, check whether it’s based on 38 hours or a different span. Part-time or casual roles may have fewer hours. Always clarify the weekly hours before you negotiate.
Casual Loading: Add 25% on Top
If you’re a casual employee, your base rate is lower than the casual rate you actually receive. The National Minimum Wage from 1 July 2026 is $26.44 per hour for permanent employees, but casuals get $33.05 per hour – that’s the base rate plus a 25% casual loading. When you use our calculator, enter your base hourly rate (the permanent equivalent) and tick the casual loading checkbox. The tool adds 25% automatically. Never type a rate that already includes casual loading.
Super Is Paid on Top
Superannuation guarantee is 12% of your ordinary time earnings, paid by your employer on top of your salary. It is not part of the salary package you negotiate – it’s an additional cost to the employer. For a $59,280 annual salary, super adds $7,113.60 per year. The maximum contribution base for 2026–27 is $270,830, so super stops once your earnings exceed that. When negotiating, remember that the total cost to the employer is your salary plus super.
Tax and Take-Home Pay
Your take-home pay depends on tax and the Medicare levy. For 2026–27, the resident tax rates are:
- Nil up to $18,200
- 15% from $18,201 to $45,000
- 30% from $45,001 to $135,000
- 37% from $135,001 to $190,000
- 45% above $190,000
Medicare levy is generally 2% of taxable income. Our calculator uses these rates to estimate your net annual pay, but it does not deduct HELP loans, the Medicare levy surcharge, or salary sacrifice. Use it as a guide, not a determination.
How to Negotiate a Salary Package Using Award Information
The Fair Work Ombudsman explains that some awards allow annualised wage arrangements, where a fixed salary covers minimum pay, penalties, overtime, allowances, and annual leave loading. If you’re offered a salary, check whether it meets or exceeds what you would earn under the award for the hours you actually work. The Ombudsman’s Pay Calculator can help you work out your minimum entitlements.
When negotiating, ask the employer:
- Which award or agreement covers the role?
- What is the classification and minimum hourly rate?
- Does the salary include casual loading (if applicable)?
- How are overtime and penalty rates handled?
- Is super paid on top of the agreed salary?
Employers must keep records of hours worked and pay slips showing your annual rate. Use our timesheet to track your hours and compare against your pay.
Fortnightly Pay and Budgeting
Most employers pay fortnightly. Your fortnightly gross pay is your weekly pay multiplied by 2. For the $30 per hour example, weekly pay is $30 × 38 = $1,140, so fortnightly is $2,280. Knowing this helps you budget and check your pay slips.
Reference Tables and Pay Guides
For detailed award rates, allowances, and penalty rates, see our pay guides and reference tables. The Fair Work Ombudsman publishes pay guides for each award with minimum rates. If your employer has an enterprise agreement, that agreement may set different rates – always check which instrument applies.
Summary
To negotiate a salary package confidently:
- Convert your hourly rate to annual using 38 hours × 52 weeks.
- Add casual loading if you’re casual (25% on top of base rate).
- Remember super is paid on top (12% of ordinary earnings).
- Use the Fair Work Ombudsman’s tools to verify minimum entitlements.
- Consider tax and Medicare to estimate take-home pay.
Our hourly conversion tool does the maths for you. Start with your base rate, tick casual loading if needed, and see the annual, fortnightly, and weekly figures including super and tax estimates.
Disclaimer
Annual pay here is hourly rate × hours per week × 52. It assumes the same rate every week, no unpaid overtime, no penalty rates, no allowances, and no salary sacrifice. Super is estimated at 12% of ordinary earnings only, paid on top, and stops at the $270,830 maximum contribution base. Tax is the 2026–27 resident scale with the full tax-free threshold. Medicare uses the 2025–26 single reduction thresholds because the 2026–27 reduction thresholds were not confirmed here. HELP, the Medicare levy surcharge, and salary packaging are not deducted. This is an estimate, not a determination of your pay or tax.
Open the same rate on the home timesheet. Read the reference tables before treating a figure as your pay.