Salary vs Wages: How to Convert Your Hourly Rate to Annual Pay in Australia
Based on a 38-hour week, your annual gross pay is your hourly rate multiplied by 1,976 hours (38 × 52).
Understanding Salary vs Wages in Australia
When you're offered a job or negotiating pay, you'll often hear the terms "salary" and "wages" used interchangeably. But they have distinct meanings under Australian workplace law. The Fair Work Ombudsman explains that a salary is a fixed annual amount paid regularly, regardless of the hours you work each week. Wages, by contrast, are calculated per hour worked. Some awards allow an annualised wage arrangement, which pays a fixed amount that covers minimum pay, penalties, overtime, and allowances – but it must be reviewed to ensure it's not less than what you'd earn under the award.
This article focuses on the simple conversion from an hourly wage to an annual figure, using the standard 38-hour full-time week. It also covers tax, the Medicare levy, and super guarantee, so you can compare a salary offer against your current hourly rate.
How to Calculate Your Annual Pay from an Hourly Rate
The basic formula is straightforward:
Annual gross pay = hourly rate × hours per week × 52
We assume 38 hours per week for full-time work, as that's the ordinary hours in most awards and the National Employment Standards. For example, if you earn $30 per hour:
- Weekly: $30 × 38 = $1,140
- Fortnightly: $1,140 × 2 = $2,280
- Annual: $30 × 38 × 52 = $59,280
If you work part-time or casual, use your actual average weekly hours. Our the timesheet lets you enter your base hourly rate and toggle casual loading – it does the multiplication for you.
Fortnightly Pay
Many employers pay fortnightly. To get your fortnightly gross, simply multiply your weekly pay by 2. Using the example above, $1,140 × 2 = $2,280. This is a handy figure for budgeting.
The National Minimum Wage and Award Rates
From 1 July 2026, the National Minimum Wage (NMW) set by the Fair Work Commission is $26.44 per hour, or $1,004.90 for a 38-hour week. This applies to award/agreement-free employees. If you're casual, you get a 25% loading, making the minimum casual rate $33.05 per hour.
Most employees are covered by an award that sets higher minimum rates. For example, the Clerks Award, the Hospitality Award, or the Retail Award each have their own pay tables. You can find the exact rates using our pay guides or the Fair Work Ombudsman's Pay and Conditions Tool. Always check your award before assuming the NMW applies.
Casual Loading
Casual loading is paid instead of entitlements like paid leave. It's 25% on top of the base hourly rate. When using our calculator, check the "casual loading" box to add it automatically. Never type a rate that already includes casual loading – the tool adds it for you. For more detail, see casual loading.
Tax and Medicare on Your Annual Income
Once you have your annual gross pay, you can estimate your tax using the 2026–27 resident tax scale:
- Nil tax on the first $18,200 tax-free threshold
- 15% on income between $18,201 to $45,000
- 30% on $45,001 to $135,000
- 37% on $135,001 to $190,000
- 45% above $190,000
Plus the Medicare levy generally 2% (based on 2025–25 single reduction thresholds). For example, a $80,000 annual gross:
- Tax: $18,200 tax-free: $0
- Tax on $18,200 to $45,000: ($45,000 – $18,200) × 15% = $4,020
- Tax on $45,001 to $80,000: ($80,000 – $45,000) × 30% = $10,500
- Total tax: $4,020 + $10,500 = $14,520
- Medicare levy: $80,000 × 2% = $1,600
- Total deductions: $16,120
- Net annual pay: $63,880
This is an estimate. It doesn't include HELP, Medicare levy surcharge, or salary packaging. For a more detailed take-home pay calculation, see take-home pay.
Super Guarantee Paid on Top
Super guarantee is 12% of your ordinary earnings, paid by your employer on top of your gross pay. It's not deducted from your hourly rate. The maximum contribution base for 2026–27 is $270,830. So if your annual gross is $80,000, your employer must contribute $9,600 to your super fund. This is separate from your take-home pay. Learn more at super and packaging.
Using the Timesheet Tool
Our the timesheet is designed for this exact conversion. Enter your base hourly rate, select whether you're casual (to add 25% loading), and the tool shows your weekly, fortnightly, and annual gross pay. It also estimates tax and super based on the figures above. Remember, the tool assumes 38 hours per week and no unpaid overtime, penalty rates, or allowances. It's a starting point for comparing salary vs wages.
Salary vs Wages: Which Is Better?
There's no universal answer. A salary offers predictability – you know exactly what you'll earn each pay period. But if you work overtime regularly, you might be better off on wages with penalty rates. Annualised wage arrangements can give you the best of both, but they must be reviewed annually to ensure you're not short-changed. Always read your award or agreement carefully.
For more context on average earnings, see average pay and hourly conversion.
Open the same rate on the home timesheet. Read the reference tables before treating a figure as your pay.