Work value case – Aged care industry | Fair Work Commission

Purpose

The Aged Care Industry is currently undergoing reform to address the findings of the Royal Commission into Aged Care Quality and Safety. A key finding in the report (Recommendation 84) proposes an increase in wage rates to better reflect the value of work carried out by aged care employees.

In 2021, the following 3 applications were lodged to the Fair Work Commission to vary the minimum wage rates and classification structures of aged care sector employees:

1. Application by Health Services Union (HSU) and others to vary the Aged Care Award 2010.
2. Application by the Australian Nursing and Midwifery Federation (ANMF) to vary the Nurses Award 2020.
3. Application by Health Services Union to vary the Social, Community, Home Care and Disability Services Award 2010 (SCHADS Award).

The parties involved in these applications include employee organisations entitled to represent workers in the aged care sector and the Commonwealth government, jointly committed to acknowledging and adequately compensating the valuable contributions of aged care employees.

Process

Applications will be determined in 3 stages.

Stage 1

Involves a review of minimum wages to properly compensate direct care workers, in either residential or in-home aged care settings, for the value of the work performed. Direct care workers include Registered Nurses, Enrolled Nurses, Assistants in Nursing, Personal Care Workers and Health Care Workers. On 4 November 2022, an interim decision was made to increase wage rates by 15%.

Decision [2022] FWCFB 200 of 4 November 2022

Stage 2

Comprises a review of the timing and phasing of the interim increase to modern award minimum wages. Parties are also invited to file submissions and evidence on whether the interim increase should apply to Head Chefs/Cooks and Recreational Activities Officers/Lifestyle Officers under the Aged Care Award. On 21 February 2023, a decision was issued stating the 15% increase will extend to these additional roles which will take effect from 30 June 2023.

Decision [2023] FWCFB 40 of 21 February 2023

Stage 3

The Fair Work Commission (FWC) has been dealing with long-running proceedings concerning union claims for increasing the minimum wages of employees working in the aged care sector, who are covered by the Aged Care Award 2010, the Nurses Award 2020 and the Social, Community, Home Care and Disability Services Industry Award 2010 (Relevant Awards).

Those proceedings have now entered their third stage, in which the FWC is considering whether:

• Indirect care workers covered by the Relevant Awards should be entitled to increased minimum wages (so far in the proceedings, the FWC has not awarded a wage increase to such employees);
• Other categories of employees covered by the Relevant Awards should be entitled to wage increases on the basis of maintaining relativities between their wages and other employees covered by the Relevant Awards, as well as other modern awards across the system; and
• The classification structures in the Relevant Awards should be amended or revised.

The industry has been busy placing submissions in relation to this application. You can read the further relevant submissions from the parties here.

Steps

Employers should consider how these changes may affect their organisation, initiate a review of current agreements, and seek further advice as required.

IgniteHR will continue to provide updates as more information becomes available.

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