Around 1.86 million workers who rely on minimum pay rates will receive a weekly rise of $15.80 per week following a decision by the Fair Work Commission.

The increase represents a 2.4 per cent rise for Australia’s lowest paid workers and will take effect from July 1.

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Under the decision, minimum wage workers will be entitled to an hourly rate of $17.70 per hour, which equates to $672.70 a week for working 38 hours.

Commission president Justice Ian Ross said Australia’s prevailing economic circumstances provided an opportunity to modestly improve the living standards of low paid workers.

Justice Ross cited evidence from the Productivity Commission, which indicated the pay rise would not have a measurable impact on employment.

The increase is slightly more than half of the $30 claim argued for by the Australian Council of Trade Unions.