Base pay rate
Base pay rate is the minimum hourly pay rate an employee must be paid for their ordinary hours of work.
The base pay rate is a set hourly wage that represents the minimum amount an employee should earn for their normal working hours. It's determined by factors like the industry, job role, and any applicable awards or agreements. This rate doesn't include additional payments like overtime, bonuses, or allowances, but serves as the foundation for calculating an employee's total earnings.
Why the base pay rate matters
The Fair Work Act uses the base rate of pay to calculate several National Employment Standards entitlements, including redundancy pay and pay for annual leave and personal/carer's leave. It does not include incentive payments, bonuses, loadings, monetary allowances, overtime or penalty rates. For example, a casual employee's base rate does not include their 25% casual loading, and an employee who receives a weekly tool allowance does not have that allowance counted in their base rate.
Read our guide to redundancy pay to see how the base rate is used.
General information only
This content is general information about Australian employment law, current at the date it was last reviewed. It does not take your circumstances into account and is not legal advice. For advice about your situation, call Employment Compass on 1300 144 002.
Last reviewed: October 2026
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