(Cth) Abolish Junior Rates for 18- to 20-Year-Old Workers in Awards

Akash Merai, Chamika Fonseka & Mecca Setiawan
Jan 7
7 min read

Updated: Jan 8

Author: Akash Merai, Chamika Fonseka & Mecca Setiawan | Publish date: 7/1/2026

P: Employees aged 18 to 20 can be paid less than employees aged 21 and older under modern awards.
S: The Minister for Employment and Workplace Relations should amend the definition of a ‘junior employee’ under section 12 of the Fair Work Act 2009 (Cth) to omit ‘21’ and substitute with ‘18’ to end the classification of workers aged 18, 19 and 20 as junior employees.

Problem Identification:

Section 12 of the Fair Work Act 2009 (Cth) (the Act) defines a ‘junior employee’ as an employee under the age of 21. Section 139 of the Act permits modern awards to include wage rates for junior employees.

According to Youth Law Australia (YLA), this allows ‘a young person [to be] paid significantly less than an older person performing an identical job’, regardless of skill, experience, or productivity. They have therefore argued that ‘junior wages sanction age discrimination’. The Australian Council of Trade Unions (ACTU) has also said that junior wages exacerbate cost-of-living pressures, push young people to ‘take extra shifts’, and compound inequality in educational outcomes.

Context:

A modern award refers to a document that defines the minimum conditions of employment (including wages) in a particular industry.

A junior rate refers to an award provision that allows a junior employee to be paid a percentage of the wage rate of an adult employee.

The McKell Institute, a policy research organisation, has estimated that junior rates cost junior employees approximately ‘$3.54 billion less in wages per year,’ with an average annual loss of ‘$8,483 per junior employee’.

According to the Young Workers Centre (YWC), assumptions that young people have fewer family responsibilities and can rely on family support have often been used to justify junior rates. However, they have stated that these ‘are not reflective of the reality faced by thousands of young people today.’

Arguments:

The ACTU has argued that junior rates are unfair because they allow employees aged 18 to 20 to be paid less than the adult wage, despite legally being adults with ‘the same social and legal responsibilities’. The YWC has highlighted that junior employees are not only ‘teen[s] working after school’, but also include 18- to 20-year-old adults who have left home for tertiary study, are in full-time work, or have caregiving responsibilities. Dr Intifar Chowdhury (Lecturer in Government at Flinders University) has argued it is unreasonable that young people bear adult responsibilities at age 18, but are ‘penalised with lower pay’ when they ‘receive no discounts on essential expenses such as rent, bills, or groceries.’

Jack Thrower (Senior Economist at The Australia Institute) has argued that the ‘significantly lower pay’ provided by junior rates creates avoidable cost-of-living pressures for junior employees. Sally McManus (ACTU Secretary) has further noted that ‘“[t]he cost of living and housing disproportionately falls on young workers”’ and that ‘“Wage discrimination in the forms of youth wages…are compounding economic insecurity for young people.”’ An annual Monash University survey reported that in 2025, 85% of young Australians had experienced financial difficulties in the preceding 12 months. They further found that over 50% had to skip meals or eat less, and 73% had experienced rental stress.

The YWC has found that junior rates force young people ‘to work more hours than their older counterparts’. Thrower found that a junior employee would need to work ‘almost five hours longer [per week] than someone over 20’ to afford the average rent in a capital city such as Sydney. He argued that this forces them to choose between ‘longer hours or…cheaper, low-quality housing in less convenient locations’. The Australia Institute has cited long working hours as a health and safety issue, contributing to anxiety, depression, cardiovascular disorders, and a higher risk of injury.

YLA has warned that junior wages ‘risk compounding inequality in educational outcomes for young people’. According to the YWC, working longer hours leaves young people with ‘less time to devote to completing their education’. They noted that young people ‘overwhelmingly cited financial concerns as the main barrier to study’. The ANU Centre for Social Policy Research found that in 2024, over 30% of high school leavers planned to reduce or delay further study due to financial pressures. They further revealed that regional/rural, low-socioeconomic status, and First Nations people were disproportionately affected.

Advice/Solution Identification:

The McKell Institute, ACTU, the YWC, YLA and Shop, Distributive and Allied Employees’ Association (SDA) have all publicly supported abolishing junior rates for 18- to 20-year-olds. The ACTU has said that this could entitle 18- to 20-year-old workers to the adult minimum wage. YLA has further stated that paying young workers equally could ‘reflect the true value of their labour and enable them to establish solid financial foundations’.

Precedent:

There are international precedents for mandating 18 to 20-year-old workers to be paid the full adult wage. Belgium phased out sub‑minimum wages for workers aged 18 to 20 between 2013 and 2015. Further, in New Zealand, the adult minimum wage applies to employees aged 16 and over with at least 6 months of continuous employment.

Public Support:

News Coverage:

The Guardian - “Young Australians aged 18 to 21 can vote. They should also be paid an adult wage”. This article argued that junior rates for 18- to 20-year-olds were unfair as they cut young workers’ incomes despite adult responsibilities and rising living costs. It also challenged training costs and youth employment as justifications for junior rates. By: Intifar Chowdhury | 16 October 2024 - Read the article here.
The Conversation - “There’s a renewed push to scrap junior rates of pay for young adults. Do we need to rethink what’s fair?” This article outlined the case for ending junior rates on grounds that they exacerbate intergenerational inequity for junior employees while employers benefit from the ‘wage discount’. By: Kerry Brown | 4 October 2024 - Read the article here.
SBS News - “'Deeply unfair': The divide over paying Australians like Jenny more”. This article detailed the campaign to end junior rates, and explored the adverse impacts of junior rates on employees under 21. By: Elfy Scott | 16 August 2024 - Read the article here.
SBS News - “'More work, less school’: Australian teens like Arya are stressed about their finances”. This article discussed how the cost-of-living crisis has made balancing work and study increasingly challenging for young people. By: Anna Bailey | 3 December 2023 - Read the article here.
ABC News - “Report highlights mental toll on young Australians amid cost-of-living crisis”. This article discussed a youth mental health report which found that financial stress has made it increasingly difficult for young people to meet essential expenses, impacting youth mental health, exacerbating socioeconomic disadvantage, and impacting their education and career prospects. By: Gemma Breen | 19 September 2024 - Read the article here.

Where to go to learn more:

The McKell Institute - Their report analysed the economic costs created by junior rates and argued that phasing them out for 18-to 20-year-old workers could stimulate economic activity and job creation. Read the full report here.
The Young Workers Centre - Their report highlighted how junior rates can compound the disadvantage experienced by young people and create financial barriers to their education and career development. Read the full report here.
Youth Law Australia - Their 2022 submission to the Treasury Employment Taskforce highlighted that junior rates unfairly disadvantage junior employees and argued that legislative change was necessary to abolish junior rates. Read their submission here.
The Australia Institute - Their analysis demonstrated how junior rates impair junior employees’ ability to afford rent, force them to work longer hours and create avoidable cost-of-living pressures. Read the article here.
SDA Application to the Fair Work Commission (FWC) - The SDA made an application to the FWC to remove junior rates for 18- to 20-year-old employees from the General Retail, Fast Food, and Pharmacy Awards. This web page includes all submissions, including expert evidence, related to this application. View all submissions here.
Fair Work Act 2009 (Cth) - Read the full Act here.

Human Perspective:

Trigger Warning: Poverty, food insecurity

Josh is 19 and works at a supermarket chain in Sydney. Having started at 16, he now trains new staff, closes the store and handles customer complaints. Despite 3 years of experience, he earns 80% of what his 21-year-old colleague makes for the same shifts. After rent, transport and groceries, Josh often has less than $50 left each fortnight. He picks up extra shifts to cover his phone bill, but finds it hard to balance his TAFE studies while working. The constant pressure to make ends meet leaves Josh anxious about money and at risk of burning out. Josh feels frustrated that his pay does not reflect his responsibilities and wonders why, after turning 18, he is not being paid like an adult.

To protect the anonymity of those involved, this is a fictionalised account drawn from an amalgamation of real-life stories, experiences and testimonials gathered during the research process for this brief. Any resemblance to actual individuals is purely coincidental.

Conflict of interest/acknowledgment statement:

Support

If your organisation would like to add your support to this paper or suggest amendments, please email Info@foreaustralia.com.

Reference list:

Arnup, J., Doery, K., & Edwards, B. (2025, September 3). Cost of study and young people’s future plans. Australian National University. https://generationsurvey.org.au/data_story/cost-of-study/

Australian Council of Trade Unions. (2024, June 6). ACTU seeks wage justice for young workers. https://www.actu.org.au/media-release/actu-seeks-wage-justice-for-young-workers/

Australian Council of Trade Unions. (2025, October 27). Adult age, adult wage: ACTU backs the change. https://www.actu.org.au/media-release/adult-age-adult-wage-actu-backs-the-change/

Australian Securities and Investments Commission. (2021). Young People and Money – Survey Snapshot. https://files.moneysmart.gov.au/media/kjvjabp5/young-people-and-money-survey-snapshot.pdf

Chowdhury, I. (2024, October 16). Young Australians aged 18 to 21 can vote. They should also be paid an adult wage. The Guardian. https://www.theguardian.com/commentisfree/2024/oct/16/australia-junior-pay-rate-wages-salary

Employment New Zealand. (2024, March 1). Minimum wage rates and types. https://www.employment.govt.nz/pay-and-hours/pay-and-wages/minimum-wage/minimum-wage-rates-and-types

Fair Work Act 2009 (Cth). https://www.legislation.gov.au/C2009A00028/latest/text

Fair Work Ombudsman. (n.d.). Junior pay rates. Australian Government. Retrieved December 10, 2025, from https://www.fairwork.gov.au/pay-and-wages/minimum-wages/junior-pay-rates

Fair Work Ombudsman. (2023). Modern awards. Australian Government. https://www.fairwork.gov.au/sites/default/files/migration/723/Modern-awards.pdf

Littleton, E., & Raynes, L. (2022). Call Me Maybe (Not): Working Overtime and A Right To Disconnect in Australia. The Australia Institute. https://australiainstitute.org.au/wp-content/uploads/2022/11/Call-Me-Maybe-Not-2022-WEB.pdf

Organisation for Economic Co-operation and Development. (2024). Removing sub-minimum wage for young people - Belgium. OECD. https://www.oecd.org/content/dam/oecd/en/publications/reports/2024/11/oecd-youth-policy-toolkit_7ae28a3d/removing-sub-minimum-wage-for-young-people-belgium_50f0ab93/e92bd8cc-en.pdf

Taylor, K. (2020). The problem with junior pay rates, explained. The McKell Institute. https://mckellinstitute.org.au/wp-content/uploads/2022/10/The-problem-with-junior-pay-rates-explained.pdf

Thrower, J. (2025, May 1). Same costs, less pay: Australia pays young workers less and makes renting harder. The Australia Institute. https://australiainstitute.org.au/post/same-costs-less-pay-australia-pays-young-workers-less-and-makes-renting-harder/

Walsh, L., Huynh, T. B., & Deng, Z. (2025). 2025 Australian Youth Barometer: Understanding Young People in Australia Today. Monash University. https://doi.org/10.26180/30184270

Young Workers Centre. (2024). Age-based wages: Ending Junior rates in Australia. https://assets.nationbuilder.com/victorianunions/pages/14128/attachments/original/1720156976/24.7.5_Junior_wages_report.pdf

Youth Law Australia. (2022). Treasury Taskforce - Employment White Paper. https://yla.org.au/wp-content/uploads/2022/12/Youth-Law-Australia-Treasury-Employment-White-Paper-Response.pdf