High-Income Threshold Increased to $190,100
The high-income threshold under the Fair Work Act 2009 (Cth) has increased to $190,100 from 1 July 2026.
The threshold determines whether high-income employees who are not covered by a modern award or enterprise agreement can access unfair dismissal protections. Employees earning above the threshold may only access unfair dismissal protections if they are covered by a relevant award or agreement.
The increase may also affect employers who rely on annualised salary arrangements or guarantee of annual earnings provisions.
What employers should do: Review remuneration arrangements for senior employees and ensure employment contracts, remuneration reviews and termination processes take the increased threshold into account.
Further information is available from the Fair Work Commission – High income threshold.
National Minimum Wage Increased
The National Minimum Wage has increased to $26.44 per hour, or $1,004.90 per week for a full-time employee working a 38-hour week. Modern award minimum wages have also increased by 3.5%.
The increase applies from the first full pay period commencing on or after 1 July 2026.
What employers should do: Ensure payroll systems have been updated and confirm that all employees are receiving at least the applicable minimum wage or modern award rate.
Further information is available from the Fair Work Ombudsman – Annual Wage Review.
Increased Fair Work Penalties
The financial consequences of breaching workplace laws have increased from 1 July 2026 following the indexation of Commonwealth penalty units. The value of a penalty unit has increased to $364, resulting in higher maximum penalties for breaches of the Fair Work Act 2009 (Cth).
For most civil remedy provisions under the Fair Work Act, maximum penalties have increased to:
- Individuals: up to $21,840 per contravention; and
- Companies: up to $109,200 per contravention.
For serious contraventions, where an employer knowingly breaches workplace laws as part of a systematic pattern of conduct, the maximum penalties have increased to:
- Individuals: up to $218,400 per contravention; and
- Companies: up to $1,092,000 per contravention.
These penalties can apply to a range of workplace law breaches, including underpayments and failures to comply with obligations under the Fair Work Act.
What employers should do: Review payroll practices, employment classifications and workplace processes to identify and address potential compliance issues. With increased penalties applying, proactive compliance reviews are more important than ever.
Further information is available from the Federal Register of Legislation – Fair Work Act 2009 (Cth) and the Attorney-General’s Department – Commonwealth penalty units.
NSW Psychosocial Hazards Code of Practice
The NSW Code of Practice – Managing Psychosocial Hazards at Work commenced on 1 July 2026, providing practical guidance for employers on identifying, assessing and controlling psychosocial risks in the workplace.
The Code addresses hazards such as excessive workloads, workplace conflict, bullying, poor organisational change management, inadequate support and exposure to traumatic events. While the Code does not create new legal duties, it may be used as evidence in proceedings about whether an employer has met its obligations under NSW work health and safety laws.
What employers should do: Review psychosocial risk management processes, update WHS policies where required, train managers to identify psychosocial hazards and ensure workers are consulted when assessing and controlling risks.
In detail
From 1 July 2026, NSW employers must be able to demonstrate how they are managing psychosocial hazards in the workplace, not simply rely on workplace policies.**
Amendments to the Work Health and Safety Act 2011 (NSW) now require persons conducting a business or undertaking (PCBUs) to either comply with an approved Code of Practice or demonstrate that an alternative approach provides an equivalent or higher standard of health and safety.
For most organisations, the benchmark will be the **NSW Code of Practice: Managing psychosocial hazards at work**, making it more important than ever to have a documented and proactive psychosocial risk management framework.
What has changed?
Psychosocial hazards—including excessive workloads, bullying, harassment, workplace violence, poor role clarity, inadequate support and poorly managed organisational change—have long fallen within employers’ WHS obligations.
The key change is that employers must now be able to demonstrate how these risks are identified, assessed, controlled and regularly reviewed. A policy sitting on an intranet or in an employee handbook will no longer be sufficient evidence of compliance.
Instead, employers should have practical systems in place that actively manage psychosocial risks as part of their overall WHS framework.
What employers should do
NSW employers should review their WHS systems and ensure they:
- identify psychosocial hazards across roles, teams and work practices;
- consult workers about psychosocial risks and workplace concerns;
- undertake and document psychosocial risk assessments;
- implement effective control measures, prioritising higher-order controls such as workload redesign, improved resourcing and clearer reporting structures;
- regularly review whether controls remain effective; and
- maintain records demonstrating the steps taken to manage psychosocial risks.
Employers should also ensure officers and senior leaders receive regular reporting on psychosocial risks as part of their due diligence obligations under WHS legislation.
Why it matters
SafeWork NSW has reported increasing regulatory activity relating to psychosocial hazards, reflecting a growing focus on psychological health as a core workplace safety issue.
Businesses that cannot demonstrate a systematic approach to managing psychosocial risks may face enforcement action, including improvement notices, prosecutions and significant penalties under the WHS Act.
Key takeaway
NSW employers should treat these reforms as an opportunity to review their psychosocial risk management framework. Regulators will expect more than well-drafted policies—they will expect evidence of a proactive, documented and regularly reviewed system for identifying and controlling psychosocial hazards.
*This article is intended to provide general information only and should not be relied upon as legal advice. Specific advice should be obtained for individual circumstances.*
Further information is available from SafeWork NSW – Managing psychosocial hazards at work.
Further resources
Employers can access the latest workplace guidance and compliance information from:
