Two pay rises in one financial year, a rule almost every explainer gets wrong, and what the rising floor does to your margins.
The short version
- Your clinicians' wages change twice in three months: the 4.75% annual review from 1 July 2026, then a whole new classification structure from 1 October 2026, phasing to 2030.
- The published new rates are in 2025 dollars — the July rise stacks on top and can't be absorbed.
- The rule most explainers get wrong: the no-disadvantage floor. Existing staff get the higher of their old rate or the new band — and some new bands are lower.
- The deeper shift: the pay ladder flattens, so retention built on pay-point progression just lost its lever.
- Every number below is sourced to the actual determinations — the last section shows exactly where to check.
From 1 July 2026, the wages you pay your clinicians change twice in three months. Most clinic owners are planning for one increase. There are two, under two different sets of rules, and the distance between getting it right and getting it wrong runs from an underpayment claim on one side to a blown wage budget on the other.
This is the field guide I wish existed when I started reading the determinations. It covers the health professionals under the Health Professionals and Support Services Award 2020 — physiotherapists, occupational therapists, exercise physiologists, podiatrists, psychologists, speech pathologists and the rest. Everything here is sourced to the actual Fair Work Commission decisions, and the last section tells you exactly where to find each number so you can check me.
What is actually changing?
Two separate things are happening to the same award in the same year.
One: the annual wage review. Like every year, modern award minimum rates go up. For 2026 the increase is 4.75%, operative from the first full pay period on or after 1 July 2026. Nothing unusual — it happens every July.
Two: a structural overhaul. On 1 October 2026, the entire classification system for health professionals is replaced. This is the result of a multi-year Fair Work Commission review that found the work of health professionals had been undervalued on gender grounds, and ordered the rates corrected. It is not a normal wage rise. It changes how your people are classified, how they progress, and what they are owed. (Why the profession was priced wrong in the first place — and what that has done to it — is the subject of Evidence-Based Economics.)
The old system used pay points tied to your qualification — a three-year degree started you here, a four-year degree there, a Masters higher again, then you moved up a pay point each year. The new system uses two things: the AQF level of the qualification your profession requires to practise, and your years of experience in the profession.
AQF means Australian Qualifications Framework. It is set by your profession, not your individual study. A physiotherapist is AQF Level 7 whether they hold a bachelor, honours or a masters. A psychologist is AQF Level 9. Your personal academic achievements no longer move you up a band — the profession sets the level, and experience moves you through it.
The new experience bands are: 1st year, 2nd–3rd year, 4th–6th year, and 7th year and beyond. Experience counts from the date someone first worked in the profession, not their graduation date.
When does it happen? The dates that matter
The structural increase phases in over five steps:
- 1 October 2026 — new structure plus the first stage of new rates
- 30 June 2027 — second stage
- 30 June 2028 — third stage
- 30 June 2029 — fourth stage
- 30 June 2030 — final stage, full rates
Stack that on the July annual review and a single clinician's lawful minimum looks like this through one financial year:
- Now until 30 June 2026 — current rate
- 1 July 2026 — current rate plus 4.75%, still under the old structure
- 1 October 2026 — new structure, first stage
So for the July to September quarter you are running the old pay-point system with the annual rise applied. From October you switch the whole team to the new bands. Two structures, one financial year, with the changeover landing mid-quarter. That alone is a payroll headache most owners have not budgeted the admin time for.
What are the new rates?
These are the first-stage rates that apply from 1 October 2026, straight from the determination. They are weekly full-time rates (divide by 38 for hourly).
Senior roles (genuine supervisors, specialists and managers) sit above this: Level 2.1 $1,857.20, Level 2.2 $1,893.30, Level 3 $1,893.30, Level 4 $2,385.80.
One catch that trips everyone up: these printed figures are in 2025 dollars. They do not yet include the July 2026 annual review increase. The Commission will publish an updated table that folds the 4.75% in. Until then, to estimate the real October figure you apply 4.75% to the printed rate. For an AQF 7 physiotherapist that means the published $35.40 an hour for the 2nd–3rd year band becomes about $37.08 once the review is layered on.
By the time the phase-in finishes in 2030, the AQF 7 bands land around $1,499.90, $1,579.30, $1,719.30 and $1,859.40 a week — again in today's dollars, before another four years of annual reviews on top.
The rule almost everyone is getting wrong: the no-disadvantage floor
Here is where most of the explainer videos and HR summaries fall over, and where you can quietly underpay or overpay your whole team if you follow them.
When the new structure starts, the old award does not vanish. It runs in parallel. For anyone employed on 30 September 2026, the determination says you pay the higher of their new band rate or the rate they were already on. The old rate becomes a floor underneath the new one.
This matters because some of the new band rates are lower than current pay points. Take a physiotherapist two years out, sitting on the old Level 1 pay point 5 at $36.05 an hour. Under the new structure they translate into the AQF 7 2nd–3rd year band, which after the annual review is about $37.08. But their old rate, lifted by the same 4.75%, is $37.76. The floor wins. They stay at $37.76, not the new band rate.
Get this wrong and it goes one of two ways. Drop them to the new band rate and you have underpaid a protected employee, which is a breach. Or assume everyone jumps to a shiny new number and you hand out rises the award never required.
A worked version, for a small physio clinic:
- A new graduate (four-year degree) goes from $31.99 now, to $33.51 in July, to $34.44 in October. The new band beats their old rate, so they get the lift.
- A masters-qualified graduate looks like they drop back to "first year" — the new band there is $34.44. They do not drop. The floor holds them at their old pay point rate, about $34.66. Their masters premium is preserved on the way through, even though the new structure no longer pays for the qualification itself.
- That two-years-out physio on pay point 5 stays at $37.76, floored above the new band, until the phase-in catches up to them a couple of years later.
Same award change, three different outcomes, and only one of them is the simple "apply the new rate" most coverage assumes.
How do existing staff move across? The translation
Every current employee gets mapped from their old classification into a new band on 30 September 2026. The determination spells out the mapping, and it is not a flat "count their years." It reads off their old pay point and their entry qualification.
That last part is the wrinkle. The same old pay point can land in different new bands depending on how the person entered. A clinician who started at the bottom on a diploma has clocked more years to reach a given pay point than someone who entered higher on a masters, so the diploma-entry person translates into a higher experience band. Same pay point, different landing.
The headline for your senior people: the old Level 2 pay-point ladder is absorbed into the top of the new Level 1. Four old pay points collapse into roughly two new bands. The new "Level 2" is now reserved for genuine supervisors, specialists and managers — the territory that used to be Level 3. So a clinician you thought of as senior may simply become an upper-band Level 1, on much the same money as a colleague with half their tenure.
How do I work out what to pay one specific person?
Five steps, and you can do any individual by hand:
- Current rate. Find their Level and pay point in the current award (clause 17).
- July 2026. Multiply by 1.0475 for the annual review.
- New band. Read their old pay point across to its new AQF band using the translation tables.
- New rate. Look up that AQF level and band in the new rate table, and multiply by 1.0475.
- Apply the floor. Their October minimum is the higher of step 4 or step 2.
Do that for thirty staff and you will see the real shape of your wage bill. You will also see why doing it by hand, for a whole team, across five phase-in dates, is the part nobody has the patience for.
Why this is really a margin question
Most of the coverage stops at the mechanics: reclassify, apply the rate, move on. That is the easy part, and it is the part everyone is competing to explain. The harder question, and the one that decides whether your clinic is still healthy in 2030, is what a rising floor does to the economics underneath it.
The award is not the problem on its own. The problem is a rising wage floor meeting weak clinic economics, and slowly exposing it.
Work it through one clinician. A senior on a $95k salary, with super, at 80% utilisation across 44 weeks and an average charge of $220, generates around $270k and costs about $106k all-in — a wage percentage near 39%. Drop their utilisation to 70% and revenue falls to around $237k while the cost stays put, pushing the wage percentage to about 44%. A small drop in utilisation moves the wage percentage a long way. Now lift the floor under that salary every year to 2030 and hold utilisation flat, and the maths gets tighter each step.
The clinics that absorb this without drama share a profile: roughly $1M-plus in revenue, 15–20% net profit, 80% utilisation, 80% retention, and around $250k of revenue per clinician. The clinics that feel it are the ones already paying close to award, running thin utilisation, carrying underperformers, and relying on price they cannot lift. For them the rising floor is not an annual nuisance. It is a slow squeeze that gets worse every July and every phase-in date.
If you take one number into your next planning session, make it revenue per clinician against that $250k mark. The award has just made it the line between a business that compounds and one that erodes.
What the changes quietly do to your pay ladder
There is a second strategic shift hiding in the compression.
Because the old Level 1 and Level 2 pay points fold into a handful of new bands, the gap between a mid-career clinician and a genuinely senior one narrows sharply. A clinician with six years and one with twelve can end up on the same new rate. The experience premium you may have built into your pay scale — the thing that quietly said "stay, and you earn more" — largely flattens out.
If part of your retention logic was paying people up the pay-point ladder over time, the award has just taken that lever off you. From October, base rate rewards experience much less than it used to. Which means the reasons for a good clinician to stay have to come from somewhere you still control: the role, the scope, the development, the incentive structure, the ownership pathway. Owners who notice this early rebuild their retention around those levers. Owners who do not will watch their best people get within a dollar an hour of their juniors and wonder why loyalty feels cheaper.
Worth checking at the same time: your bonus and incentive structures. As base rates rise, threshold and commission components shrink against them. A clinician on a $70k base plus $30k of bonus who moves to an $80k-plus base for the same performance sees their bonus shrink as a share of the total, even if total pay holds. The incentive can quietly lose its visibility — and its pull — without anyone changing the plan.
What to do now
In rough order:
- Reclassify every clinician into their new AQF level and experience band, using their date first worked in the profession.
- Pin each person's experience anniversary date — it now drives their progression.
- Model your wage bill to 2030, with the floor applied per person and the annual review layered on. Not a single number — a curve.
- Audit your contracts. Confirm they reflect current roles and pay, and check that annual leave loading is documented. Paying above award does not automatically extinguish leave loading — if it is not written down, you may still owe it.
- Recheck your bonus and incentive structures against the new base rates.
- Move your retention thinking off base pay and onto the levers you still control.
- Pressure-test your economics — revenue per clinician, utilisation, wage percentage — before the floor does it for you.
The honest gaps — what is not locked yet
So you are not caught out by the fine print:
- The official rate table with the 4.75% folded in has not been published yet. The figures above are the determination's 2025-dollar rates with the review applied as an estimate.
- Only the 1 October 2026 rates and the 2030 end point are published as firm tables. The intermediate years — 30 June 2027, 2028 and 2029 — are not yet released as dollar figures. Anyone quoting exact numbers for those years is estimating between the two fixed points.
- The annual review increase itself (4.75%) is decided and firm; only the award-specific paperwork is still being formalised.
None of this changes the structure or the floor. It just means a couple of the numbers will firm up over the next few months.
Where to find all of this yourself
If you want to verify any figure, here is the map.
All of the decisions are on the Fair Work Commission's gender-based undervaluation — priority awards review case page, and the Fair Work Ombudsman has a plain-English summary of the changes. The two key determinations are public PDFs: the December 2025 decision, [2025] FWCFB 297 (which sets the rates) and the final determination, [2026] FWCFB 123 (the operative award amendments).
FAQ
When do the 2026 award changes start?
Two changes hit in one financial year: the annual wage review adds 4.75% from the first full pay period on or after 1 July 2026, and the new classification structure with the first stage of new rates starts 1 October 2026. Further stages land 30 June 2027, 2028, 2029 and 2030.
What is the no-disadvantage floor?
For anyone employed on 30 September 2026, you pay the higher of their new band rate or the rate they were already on. Some new band rates are lower than current pay points — dropping a protected employee to the new rate is a breach, and assuming everyone jumps to a new higher number hands out rises the award never required.
How are physiotherapists classified under the new structure?
By the AQF level of the qualification the profession requires (physiotherapy is AQF 7) and years of experience in the profession, counted from the date first worked — not graduation. Bands: 1st year, 2nd–3rd, 4th–6th, 7th+. Personal postgraduate qualifications no longer move the band.
Do the published new rates include the July 2026 annual wage review?
No. The printed figures are in 2025 dollars. Estimate the real October figure by applying 4.75% to the printed rate until the Commission publishes the updated table. The structural increases stack on top of annual reviews and cannot be absorbed into them.
How much will award wages rise by 2030?
By the end of the phase-in, the AQF 7 bands land around $1,499.90 to $1,859.40 a week in today's dollars — before another four years of annual reviews on top.
Why are the rates changing?
The Fair Work Commission found the work of health professionals had been undervalued on gender grounds and ordered the rates corrected. It is a structural re-rating, not a normal wage rise. The full story of that ruling — and what it says about how the profession prices itself — is in Evidence-Based Economics.
Related reading
- Evidence-Based Economics: can a physio clinic be profitable and ethical at the same time?
- How many patients per hour should a physio see? (2026 data)
- New graduate physiotherapy wages
The compliance piece is the easy 20%. The rising floor, the flattening pay ladder, and what both do to your margins to 2030 — that is the work, and most clinic owners will not see it until it is already in their numbers.
The flattened pay ladder is also why retention just became a design problem instead of a pay-rise problem. That is the subject of the next live workshop: Stop Losing Your Best People, Thursday 30 July, 12:30pm AEST.
And if you want this run for your clinic specifically — your people, your numbers, your wage curve to 2030 — that is advisory work, and there are only a handful of seats.
This is a reference guide, not legal advice. Figures will firm up when the Fair Work Commission publishes its post-annual-review determination.
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