Aged care workers will get a pay rise of at least 15 per cent, after Australia’s industrial umpire handed down an “interim” decision in a highly anticipated and long-awaited wage case.
Unions had wanted a 25 per cent pay boost and a wages increase was a key recommendation of a 2021 Royal Commission, which exposed major problems in the sector, including overwork, neglect and abuse.
In a lengthy decision published late on Friday, the Fair Work Commission (FWC) said an interim increase of 15 per cent was "plainly justified", with the decision establishing the "existing minimum rates do not properly compensate employees for the value" of their hard work.
"We accept the expert evidence that, as a general proposition, work in feminised industries — including care work — has been historically undervalued and that the reason for that undervaluation is likely to be gender-based," the FWC said in its ruling.
"We also recognise that there is ample evidence that the needs of those being cared for in their homes have significantly increased in terms of clinical complexity, frailty and cognitive and mental health."
Further pay rises could be possible
The timing of the pay rise — and whether it should be gradually introduced — will start being discussed later this month and the commission has left open the possibility of further pay increases.
"We wish to make it clear that this does not conclude our consideration of the unions' claim for a 25-per-cent increase for other employees, namely administrative and support aged care employees," the FWC added.
"Nor are we suggesting that the 15-per-cent interim increase necessarily exhausts the extent of the increase justified by work value reasons in respect of direct care workers."
It will take submissions from employers and the federal government, before handing down stages 2 and 3 of its decision.
It argued that it needed to act in stages to avoid "unduly delaying any increase to minimum wages" and to ensure it can "more quickly consider how to phase-in any initial minimum wage adjustments".
Labor has long said that low pay has contributed to people leaving the sector.
"We need to bring workers back to the aged care sector and fill the staff shortages," Aged Care Minister Anika Wells said.
"Increasing wages in aged care is essential to ensuring that men and women are paid equally," she added.
The government had promised to fund a pay increase and argued publicly in favour of it, but had not put a figure on how much salaries should rise.
"Aged care work is hard work — but it's undervalued work," said Workplace Relations Minister Tony Burke.
"This result is the first step in changing that.
"We fought for this pay rise because our government is committed to getting wages moving again, particularly in low-paid female-dominated industries like this one."
Union warns pay rise will not end 'aged care crisis'
Unions have described Friday's decision as a "down-payment" and believe broader pay increases are needed to fix problems in the sector.
They argue that aged care has suffered from government neglect over a long period, leading to shortages of trained staff, which has exacerbated the challenge of caring for Australia's ageing population and contributed to well-documented problems.
"This is a reasonable start but we need the commission to go further and permanently end the poverty wage settings that dominate aged care," Health Service Union national president Gerard Hayes said.
"Nobody should be mistaken. This will not fix the crisis. We still have massive unfinished business in aged care.
"For the last decade, this industry has relied on the goodwill of an exploited, casualised workforce. Today represents progress, but the legal, political and industrial fight continues".
United Workers Union aged care director Carolyn Smith said aged care workers would be "gutted" that there is yet to be a final outcome for other aged care support workers.
"Anyone with knowledge of aged care knows lifestyle, laundry and catering are essential to delivering the quality care residents need," Ms Smith said.
"It is a bitter pill for these workers that decisions on their pay rises have been put off for further consideration.
"During the two years the case has been on foot, these workers at the heart of the case have been working their guts out, keeping aged care running during a once-in-a-lifetime pandemic."
Aged Care is one of the fastest-growing spending areas for the federal government.
Last month's budget forecasts the cost of aged care to increase by more than 6 per cent per year over the next decade.
