‘Wage justice’: Fair Work Commission hands down aged care wage decision for workers asking for 25 per cent pay increase

One group of Aussie workers has secured a major pay win following a landmark decision by the Fair Work Commission, as the government pledges to help fund the wage change.

Aged care workers have secured a “historic” pay rise – some getting up to a 28.5 per cent increase – in what has been called a “life-changing” improvement for one of Australia’s most undervalued work groups.

The Fair Work Commission (FWC) delivered the major update on Friday following an anxious wait for consultation on the proposed changes.

The decision will impact more than 100,000 indirect employees in the sector, and comes four years after the Health Services Union lodged an application for a 25 per cent across-the-board increase.

The commission awarded direct care employees an interim 15 per cent pay rise at the end of 2022 but since then the union has continued to push for an increase for all staff.

Direct care employees are due to get up to a 28.5 per cent increase depending on their skill level and qualifications – inclusive of the previous 15 per cent increase.

Nursing assistants secured increases between 17.9 and 23 per cent.

Large swathes of the aged care workers will receive wage rises of between seven and 28 per cent, following a Fair Work decision. Picture: Supplied

“This is an historic improvement that will usher in a new era of decency and dignity in our aged care homes,” Health Services Union national president Gerard Hayes said.

“For the last decade aged care has been held together by the goodwill and commitment of a severely underpaid, insecurely employed workforce.

“Today those workers have won wage justice.”

The pay of support services workers such as laundry hands, cleaners and food services assistants will increase by 6.8 per cent through a combination of increased wages and reclassification.

In their published reasons, the commission said people involved in direct care deserved a “substantially” higher increase than the interim 15 per cent increase.

“We consider it more likely than not that the supply of direct care labour to the aged care sector, and the retention of direct care employees, will continue to improve over the medium term,” the commission’s decision says.

Prime Minister Anthony Albanese has said the government “will always work” with the aged care workforce following the decision. Picture: NCA NewsWire / RoyVphotography

“The interim 15 per cent pay rate increase will operate, we consider, as an ongoing incentive for workers to enter into and stay in the sector.

“This will be further enhanced by the additional wage increases which we propose to award to direct care employees.”

A rate of $1223.90 per week for Certificate 3-qualified employees was considered appropriate, according to the FWC’s decision.

In a joint statement, Prime Minister Anthony Albanese, Health Minister Mark Butler and Aged Care Minister Anika Wells said the government welcomed the decision from the FWC.

The government has already committed funding — including some $11bn over five years to meet the previous 15 per cent increase — to fund the award.

“We are closely examining the content of this decision, which is lengthy and highly detailed,” the statement read.

Minister For Health And Aged Care, Mark Butler, issued a joint statement welcoming the decision. Picture: NCA NewsWire / Martin Ollman

Minister for Sport and Aged Care, Anika Wells. Picture: NCA NewsWire / Martin Ollman

“We have committed to provide funding to support increases to award wages made by the Fair Work Commission in this matter and that will help deliver a higher standard of care for older Australians.

“Our government wants people to earn more and keep more of what they earn – that’s why we’re fighting for a better future for aged care workers.”

Mr Hayes said work remained to lift the wages of support workers in areas like administration and maintenance.

“These are life-changing improvements,” he said.

“They will allow the industry to retain workers which, as the royal commission noted, is absolutely essential to delivering continuity of care.

The historic decision has been lauded by the health services union, who say thousands of workers have now won ‘wage justice’. Picture: NCA NewsWire / Nicholas Eagar

Mr Hayes said most of the workforce could now imagine and plan for fully fledged careers where people could “plan a life around their work” and commit to it.

“Many workers have subjected themselves to the edges of poverty and homelessness to work in this industry,” he said.

“Now they can care for the elderly and also provide for themselves and their family.”

Public policy think tank The Australia Institute said the decision would also improve the lives of elderly Australians in addition to the workers caring for them.

“For too long, aged care work has been undervalued and low paid,” Fiona Macdonald, policy director at the Australia Institute’s Centre for Future Work, said.

“The Fair Work Commission’s decision to award additional pay rises, on top of an interim 15 per cent wage rise, is vital to fixing this.”

“The exclusion of indirect care workers from today’s decision is a lost opportunity to support the lowest paid workers.”

Anglicare Australia has also welcomed the move as a way to recognise the female-dominated workforce was “underpaid”.

“A strong workforce is well trained and skilled. Wages must reflect this,” executive director Kasy Chambers said.

“That’s why this decision is an important step for the sector – and the older Australians who rely on us for care.

“Now we need to ensure that the government stands by its commitment to fund these pay increases.”