Fair Work Commission hands down decision on timing of pay rises for aged care workers

In March, the FWC handed down final increases in its Stage 3 decision of the ANMF’s Aged Care Work Value Case for aged care workers except RNs and ENs. This achieved pay rises ranging from a total of 20.9-28.5% (including the initial 15% boost awarded last year) for direct care workers under the Aged Care Award, and between 17.9-23% for Assistants in Nursing (AINs) under the Nurses Award (including the interim 15% increase).

In response, the Albanese Government made a submission to the FWC requesting that the pay rises be staggered over the next two years, citing concerns including employment shortages across numerous sectors.

While the ANMF argued for wage increases to flow through immediately, including highlighting that “aged care workers have been subsidising the profit margins of their employers, the Commonwealth budget, and taxpayer, for some time”, the FWC last Thursday settled with a modified version of the government’s staggered operative date proposal. Direct care workers will receive 50% of the additional award wage increase from 1 January 2025 and the remaining 50% from October 2025. Indirect care workers, however, including cleaners and administration, will receive the full increase from next year.

What the FWC determined

  • The wage increases for direct care workers and home care workers (HCWs) awarded in the Stage 3 Aged Care decision should, as proposed by the Commonwealth, flow in two tranches
  • The operative date for the first tranche of increases for direct care workers and HCWs, and the full increases for indirect care workers, should be 1 January 2025.

While the government requested that 50% of the wage increases for direct care workers and HCWs be paid in the first tranche, the FWC has made modifications, taking into account that for some of these workers, the additional increases awarded in the Stage 3 Aged Care decision were small and, in some cases, less than 3%.

While the FWC said it noted unions’ submissions that delaying the increases would disadvantage employees because they are under pressure from such issues as the rising cost of living, the independent workplace tribunal ultimately sided with the government, yet brought forward the operative date for the tranche two payment.

“While employees would obviously prefer to have the benefit of the wage increases at the earliest available date, the weight to be given to this is diminished by two matters,” it said.

“First, the wage increases awarded in the Annual Wage Review decision 2022–238 and the Annual Wage Review decision 2023–249 will ensure that the real value of the wages of award-reliant aged care workers will have been maintained over the period since the interim 15 per cent increase took effect on 30 June 2023.

“Second, for direct care workers and HCWs, that interim increase represents for most classifications at least two-thirds of the total wage increases to flow as a result of these work value proceedings. Thus, the gender undervaluation of work found in the Stage 3 Aged Care decision has already been remedied to a substantial degree.”

What it means for direct care and home care workers

  • If half of the total increase is more than 3%, half of the total increase should take effect on 1 January 2025.
  • If the total increase is more 3%, but half of the total increase is less than 3%, a 3% increase should take effect on 1 January 2025.
  • If the total increase is less than 3%, the total increase should take effect on 1 January 2025.

What is happening for RNs and ENs?

The latest decision did not deal with additional pay increases for enrolled nurses (ENs) and registered nurses (RNs), due to the Commission currently considering a separate Work Value Case made by the ANMF for all employees covered by the Nurses Award 2020.

“The ANMF is disappointed that RNs and ENs working in aged care must continue to wait for a final outcome of the Aged Care Work Value case,” ANMF’s Senior Industrial Officer, Kristen Wischer, said.

“We hope that a result can be achieved quickly, so that all staff working in aged care receive a long-awaited and deserved increase to award wages.”

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