Horticulture Award Changes 1 July 2026 — What Every Victorian Grower Needs to Know

By Yield Australia Market Intelligence ·

The Fair Work Commission's annual wage review delivers another increase to the Horticulture Award from 1 July 2026. For Victorian vegetable growers already managing elevated input costs across fertiliser, fuel, and freight, the labour cost step-up is another significant line in the budget. Here's what you need to know.

What's Changing on 1 July

  • Base minimum rate increase — Approximately 3-4% uplift to the Horticulture Award minimum hourly rate, consistent with the national minimum wage decision. Budget for this range until the final determination is published in late June
  • Piece-rate minimum hourly guarantee — The guaranteed minimum hourly rate for piece-workers increases in line with the base rate. Every piece-rate worker must earn at least the new minimum hourly rate averaged across their shift — regardless of piece-rate output
  • Casual loading — Ensure casual contracts reflect the correct loading above the new minimum rate
  • Allowances — Tool, protective clothing, and other allowances will also adjust; check the Fair Work Commission's updated pay guide for your specific categories

The Piece-Rate Compliance Risk

Piece-rate employment is common across Victorian vegetable harvesting and packing operations — and it's also the area of highest compliance risk. The Fair Work Ombudsman has made Horticulture Award piece-rate compliance a priority area for audit activity in 2025-26, and that scrutiny continues into 2026-27.

The compliance test is straightforward in principle: every piece-rate worker must earn at least the Award minimum hourly rate when you calculate total earnings divided by hours worked. In practice, slower workers, mixed-task days, and pay period averaging create complexity.

Before 1 July: pull your payroll records for the past three months and check that no piece-rate worker has earned below the current minimum hourly rate in any pay period. If any have, correct the underpayment and review your piece rates.

Practical Steps — A Checklist

  1. Obtain the new pay rates — Download the updated Horticulture Award pay guide from the Fair Work website as soon as the 1 July rates are published (typically late June). AUSVEG VIC will also circulate a member update
  2. Audit your piece rates — Recalculate minimum-hourly-guarantee checks against the new rate for each piece-rate role. Adjust piece rates where needed so your slower workers are clearing minimum
  3. Update payroll software — Ensure your payroll system has the new rates loaded before the first pay period on or after 1 July
  4. Check casual contracts — Review casual employment agreements to confirm they reflect the new minimum rate plus correct casual loading
  5. Document everything — Keep records of your compliance audit. If the Fair Work Ombudsman comes knocking, documented due diligence is your best defence

Cost Impact — Planning Your Budget

For a typical Werribee South vegetable operation employing 10-15 staff, a 3-4% increase in minimum rates adds approximately $15,000-$25,000 in annualised direct labour costs (depending on hours, mix of permanent/casual, and overtime). For larger operations (30+ staff), the impact is proportionally higher.

Labour is already the single largest input cost category for most vegetable operations (30-40% of total costs). Combined with elevated fertiliser, fuel, and freight, protecting margin through efficiency rather than volume is the clearest path forward for 2026-27. Use our Farm Planning Toolkit to model your cost-per-tray and cash-flow scenarios for the new financial year.

This article is for general informational purposes only and does not constitute legal or payroll advice. Consult a qualified adviser for guidance specific to your employment situation.

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