The Fair Work Commission (FWC) has announced a pay rise of up to 25 percent for Aged Care Award employees. This represents a significant shake up for Aged Care businesses and their staff. The pay increase gives plenty of cause for excitement but changes also have the potential to create confusion for industry stakeholders. This means careful planning in response is paramount.
If you are curious about the Aged Care Award pay rise, read on below!
The Decision to Increase Aged Care Pay Rates
The FWC made significant findings in the ‘Work Value Case’ last month. These findings will have far-reaching consequences throughout the Aged Care sector. Employers need to prepare their business for the changes.
If you are interested in reading a summary of the FWC decision, you can do so here.
Marking a pivotal moment for the sector, it is widely welcomed by aged care workers, advocates, and industry stakeholders alike. Understandably, employers are nervous about the implications it will have on their day to day business operations.
Why is the Aged Care Pay Rise Happening?
The Aged Care pay rise is a positive development for the industry because employees can expect greater reward for their efforts. In time employers stand to benefit from increased staff retention and access to a larger talent pool from which to hire from. Higher wages the potential to attract more people to the industry.
The decision to implement the Aged Care Pay rise from July 2024 represents a significant step towards achieving fair and equitable wages for aged care staff.
Along with the aged care award wage increase, new changes to how direct care workers are classified are expected to have flow-on positive impacts for attracting new talent into aged care who are looking for acknowledgement of their hard work, often under challenging circumstances with limited resources.
This will be a major step forward in addressing the ongoing workforce shortages affecting the industry. This is a problem that has existed for years and was only exacerbated by the COVID-19 pandemic.
What Does the Aged Care Pay Rise Mean for Employers?
The 25% pay rise for aged care workers may pose challenges to employers and payroll teams due to the need to ensure compliance with the Aged Care Award rates as well as the Nurses Award and the SCHADS Award.
For employees under these Awards already receiving above-Award salaries, employers must ensure their pay remains at least at the level mandated by the Award. This requires precise rate adjustments to avoid any reduction in compensation.
While existing Enterprise Agreements won’t automatically reflect the aged care wage increase, they must still adhere to the new minimum Award rates. This may require renegotiating to ensure compliance moving forward.
The process should be undertaken by working closely with a legal professional. Teams can then accurately implement changes whilst preserving fairness, commerciality and legality in the remuneration structures.
To learn more about how employers can be proactive in dealing with challenges related to changing pay rates, staff shortages and funding constraints you can read more here.
Award Interpretation for the Aged Care Pay Rise
The FWC’s decision to implement a 25% aged care pay rise for staff in the sector is a positive step for the industry. But these changes come with confusing new rules for classifying staff.
Fairtime is here to help Aged care employers through this transition.
We believe that every Aged Care provider has their own unique set of business challenges. Where compliance is rigid and tiresome, Fairtime has resources on hand to guide you and help you solve problems that may flow from these changes.
What is Fairtime?
Fairtime is timesheet and payroll compliance software designed to help Australian employers pay staff at the right rate.
What does it do?
When an employee enters their work hours into Fairtime, our pay rate engine converts their timesheet into a payslip with one click. Any employee, any shift pattern and at any Award classification.
We track leave and TOIL balance with custom pay calendars and pay rates. Employers often sync Fairtime with XERO or MYOB so that their pay slips become instantly available, saving them hours of manual entry.
How to use Fairtime
This is the most comprehensive A to Z compliance option for businesses in the Aged Care and SCHADS space. Our dedicated support team is on hand to help you during implementation and beyond.
We also provide Free Payroll Health Checks to help you understand your problems better.
Our affiliate law firm, Fairtime Legal, advise businesses on employment law issues like contracts or pay rate classifications for your staff.
Fairtime can also be customised to help you carry out wage remediation. You can engage accountants to manually review payslips line by line to confirm an underpayment OR you can upload historical hours into Fairtime and we’ll calculate the right rate of pay.
For a copy of the current Aged Care pay rates, you can fill out the form below.
