Proposal to phase in aged care wage rise amid worries about workforce shortages

The government aims to delay aged care workers’ wage increases, citing concerns about potential labour shortages if significant pay raises are implemented too quickly.

In the government’s submission to the Fair Work Commission on the matter, they cited job vacancies in healthcare, including roles like nursing and childcare, which surged by 118% compared to pre-pandemic levels in February 2024, contrasting with a 49% increase in other sectors.

The government is committed to funding the increase and proposes phasing in the raises over two years, starting on January 1, 2025, and January 1, 2026.

  • for indirect care workers – in full from 1 January 2025;
  • for direct care workers – 3.2.1. an increase in funding corresponding with 50 per cent of the Stage 3
    wage increases for direct care workers (including on-costs) from 1 January 2025; and an increase in funding corresponding with the remaining 50 per cent of the Stage 3 wage increases for direct care workers (including oncosts) from January 2026.

Unions, including the Health Services Union, oppose the delay, arguing it will exacerbate retention challenges in the aged care sector – a sentiment echoed by several aged care providers online.

Health Services Union national president Gerard Hayes said the government’s position if accepted, would mean aged care workers would be waiting six years for their full pay rise given their work value case had started in 2020.

“We’re not talking about getting a few more people into the sector – we’re talking about stopping the hemorrhaging of people leaving”

Health Services Union Gerard Hayes


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