Labour Hire Charge-Out Rates NSW 2026: What's Inside the Hourly Rate

Here's the line most quotes hide.

A Sydney CW1 labourer's minimum is $26.67/hr from 1 July 2026. Add the industry allowance and the 25% casual loading and a casual CW1 lands near $35.55/hr.

That is the wage. The charge-out rate sits well above it.

Stack the mandatory on-costs and the bill rate climbs into the high-$40s/hr ex-GST. Where does the rest go? And which lines are mandatory for every supplier versus only the large ones?

The maths below is illustrative and award-based. It is built from Fair Work (MA000020, 1 July 2026), ATO, Revenue NSW and icare figures.

What is a CW1 pay rate?

CW1 is the entry classification for construction labourers in the Building and Construction General On-site Award (MA000020).

From 1 July 2026 the CW1 minimum runs from $26.67/hr (level a, new entrant) to $28.05/hr (level d, competency met). The industry allowance is paid on top for all purposes.

A casual CW1 then gets the 25% casual loading. On level a, that is about $35.55/hr before any other allowance.

CW1 is the wage floor, not the charge-out rate. For every CW level, what a CW1 labourer actually does on site and the warehouse equivalents, read the full CW1 pay rate and award rates guide.

What's inside a labour hire charge-out rate?

Every NSW labour hire charge-out rate is built from the same five blocks.

Compliance Warning: Both Sides Are Exposed

This isn't just a supplier problem.

• Pay below award and the host can be caught. Host PCBUs can carry accessorial liability under the Fair Work Act when they were knowingly involved in a contravention.
• Your supplier can be caught too. The Fair Work Ombudsman, ATO, icare and Revenue NSW all audit labour hire agencies. Underpayments and unpaid super are the common patterns.
• Both sides exposed. A non-compliant rate is a deferred bill with penalties attached.

If you can't see the maths on a quote, you can't show good faith in an audit. That's the spine of why this post exists.

Component 1: Worker Pay (CW1, MA000020)

The relevant instrument for Sydney construction is the Building and Construction General On-site Award 2020 (MA000020).

CW1 is the most common classification. General labourers on site, and the default starting point for any rate conversation.

CW1 figures from 1 July 2026 (Fair Work Commission):

• Minimum hourly (level a): $26.67/hr (clause 19.1(a))
• Industry allowance (general building): $67.15/week, about $1.77/hr (clause 22.1, paid for all purposes)
• Casual loading: +25% (clause 12.4)
• CW1 (level a) casual: about $35.55/hr for a standard weekday hour, before other allowances

The minimum rate and the casual figure are different numbers. Don't quote one as the other.

Always verify the live figure on the Fair Work Pay Calculator before signing. Award rates move every 1 July.

Conditional allowances (only when they actually apply)

Casual minimum engagement means once a worker shows up, you pay at least four hours, even if the day ends early. Wet weather is handled by the wet-weather clause in your agreement, not a blanket "weather payment."

EBA sites run above award. If your site is on an EBA, the floor moves. Ask which instrument the rate is built on. Get it in writing.

Full pay guides: fairwork.gov.au, MA000020 summary and the Fair Work Pay Calculator.

Component 2: Superannuation (12%)

Super is the easiest line to verify. A fixed percentage of earnings, set by federal law.

• $35.55 × 12% = $4.27/hr on the CW1 casual figure.
• An agency still quoting on the old 2024-25 rate is out of date, and the worker's fund is short.

Payday Super from 1 July 2026: the rate stays at 12%, but super must reach the worker's fund within 7 business days after each payday, not quarterly (ATO). The quarterly float is gone.

If your agency goes under owing super, the cost is the worker's but the reputational damage is yours.

Component 3: Workers Compensation Premium

In NSW, workers comp runs through icare. Construction suppliers sit in a higher-risk WIC, so the premium is a real slice of wages. We use ~5% here as an illustrative figure.

• For our CW1 example: $35.55 × 5% = ~$1.78/hr

Why this is the line agencies fudge

Workers comp is invisible to clients.

A dodgy operator can quote on a lower-risk WIC, run under-insured, or carry premium debt until cancellation.

When a claim gets rejected because the WIC didn't cover construction, the host employer becomes the target. You allowed the worker on site and carry the duty of care under WHS law regardless of who payrolled them. See Host Employer Responsibilities for the full liability picture.

Component 4: NSW Payroll Tax (5.45%)*

* This component is conditional, not universal.

• NSW payroll tax applies only to employers whose annual NSW wages exceed $1.2 million.
• Most small clients and small in-house teams sit below the threshold and pay nothing.
• Large agencies sit well above $1.2M, so the 5.45% flows into every dollar of wage they charge.
• It's calculated on wages plus super: ($35.55 + $4.27) × 5.45% = $2.17/hr in our CW1 example.

If a small supplier charges a "payroll tax" line, ask whether they're actually above the threshold. If a large supplier doesn't show it, ask where it's hiding in the rate.

Component 5: General Overhead and Agency Margin

General overhead (~$0.85/hr, illustrative): Public Liability and Professional Indemnity insurance. White card verification, HRWL checks, PPE, payroll processing, Single Touch Payroll reporting, and from 1 July 2026 super paid on every payday under Payday Super.

Agency margin (illustrative): covers allocation, replacements, after-hours response and profit. The figure shown here is illustrative, not Leap's own margin.

The Full Build-Up: CW1 Worked Example

A general labourer, casual, standard weekday award site. Numbers are MA000020 figures from 1 July 2026.

Margin defaults off in the calculator below. That shows cost-to-supply only. Toggle it on to see how a margin layers on top.

Why "Cheap" Agencies Aren't Actually Cheaper

Strip the example back to mandatory employment costs only (for a large supplier above the payroll-tax threshold):

$35.55 + $4.27 + $1.78 + $2.17 = ~$43.77/hr in pure compliance cost (illustrative. Verify award rates at fairwork.gov.au/pay-and-wages/pay-calculator).

That is the cost-to-supply for this illustrative CW1 build. No insurance, no PPE, no admin, no margin.

So when an agency quotes well under the pack for the same role, ask where the money went. Three options (covered in Warning: Labour Hire Compliance, Avoid the Cheap):

• Underpaying the worker: a flat cash rate instead of award. The FWO recovers large sums for underpaid workers every year. Source: Fair Work Ombudsman Annual Report.
• Cutting compliance: wrong WIC on workers comp, skipping payroll tax registration, late super. Each is a ticking ATO, icare or Revenue NSW audit.
• Both: the most common. The agency is structurally insolvent the day it quotes you.

Cash Jobs: What the Law Actually Says

Paying workers cash-in-hand isn't a grey area:

• Illegal under Fair Work and ATO rules. Wages must be reported via Single Touch Payroll, with PAYG withheld and remitted every pay cycle.
• No workers comp cover. If a worker is injured on a cash arrangement, the host PCBU carries the exposure directly under the NSW WHS Act.
• Sham contracting penalties. Civil penalties apply under the Fair Work Act (verify current figures on the Fair Work sham contracting page).
• ATO penalties can apply to both the engager and the worker. Voluntary disclosure before audit reduces penalties but doesn't eliminate them.

How to Read a Labour Hire Quote

Most reputable agencies, Leap included, quote a single all-in $/hr per worker classification, not a line-itemised P&L.

The award-based maths above sits inside that single number. You shouldn't have to audit a line-by-line breakdown. That's the supplier's job, not yours.

What you should verify is whether the worker is being paid lawfully. That's the real audit.

The only line items you need to see are the ones that affect you job by job:

• Travel allowance (on jobs except fixed-location ongoing roles)
• Overnight allowance (for stays outside Sydney metro)
• Minimum hire (industry standard: 4 hrs/shift)
• Cancellation policy (typical: under 12hr notice = 2hr charge; under 1hr = 4hr charge)
• Engagement mode: On-Hire (you direct day-to-day work) vs Subcontract (agency supervises to a defined outcome). Different tax and risk treatment.

Three documents to request before the first shift:

1. icare Certificate of Currency: workers comp, active for construction WIC
2. Public Liability Certificate: at the level your head contract requires
3. Sample payslip (worker name redacted) showing pay at or above the applicable Fair Work / EBA rate

If an agency refuses those three, the issue isn't "they don't want you to see the maths." It's that they likely can't pass an audit. That's what you actually need to know.

Get a Transparent Quote

Send us the role, classification, site address, EBA or award, and start date. Rates in your email in minutes. You can also check typical ranges on our labour hire rates page before you call.

A single all-in rate per classification, built on current Fair Work, icare and Revenue NSW figures. Need flexible crews? See how casual labour hire in Sydney works.

Get a transparent rate breakdown →

For the full series on labour hire pricing in Sydney, see our parent guide: Labour Hire Cost Breakdown, The Complete Sydney Guide. For the bigger build-vs-rent question, read Is Labour Hire Worth It? An Honest Cost-Benefit Analysis.

Frequently Asked Questions