What are piece rates?
Piece rates pay an employee per unit of output rather than per hour, and are permitted under some awards subject to minimum standards.
A piece rate pays an employee an amount for each item produced or task completed — for example per piece of fruit picked or per garment made — instead of an hourly or weekly wage. Piece rates are only allowed where the relevant Modern Award or enterprise agreement specifically provides for them.
Even on a piece rate, the arrangement must comply with the standards in the award and the Fair Work Act. Some awards require a written piecework agreement and set how the rate must be calculated so that an average competent worker can earn at least the relevant minimum.
Key facts
- •Pay is based on output (per unit or task), not on hours worked
- •Only permitted where a Modern Award or enterprise agreement allows them
- •Must still meet the minimum standards set by the award and the Fair Work Act 2009
- •Some awards require a written piecework agreement
- •The Horticulture Award includes a minimum wage guarantee for pieceworkers — check the current rules with the Fair Work Ombudsman
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Award FinderFrequently asked questions
Can I be paid a piece rate instead of an hourly wage?
Only if your Modern Award or enterprise agreement allows piece rates and the proper conditions are met, including any required written agreement. If your award doesn't provide for piece rates, you must be paid the relevant hourly or weekly minimum.
Do piece-rate workers get the minimum wage?
Some awards, such as the Horticulture Award, include a minimum wage guarantee so pieceworkers are not paid below the applicable hourly rate. Check the Fair Work Ombudsman for the current rules in your industry.
FairWork Mate is an independent commercial service. We are not affiliated with, endorsed by, or associated with the Fair Work Ombudsman, the Fair Work Commission, or any Australian Government agency. Content is general information and estimates only — not legal, financial, or tax advice. Always verify with the Fair Work Ombudsman (13 13 94) or a qualified professional.