The Fair Work Commission (FWC) has handed down its decision on the timing of its Stage 3 wages rises for aged care workers, which will deliver some workers increases of nearly 30% in total.

Indirect care workers, who did not receive an increase as part of the Interim decision, will receive their pay rise from 1 January 2025.

Direct care workers and home care workers will receive their increase as follows:

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

The second tranche of the pay rise for direct care workers should take effect from 1 October 2025.

The FWC decision is in line with the Federal Government's submission that indirect care workers receive their full increase from 1 January 2025.

But the decision does not correspond with the Government's submission that for direct care workers, 50% of their increases flow from from 1 January 2025 and 50% from 1 January 2026.

Unions had submitted that the rises start from 1 July 2024.

The Aged & Community Care Providers Association (ACCPA) and Australian Business Industrial (Joint Employers) submitted that they were ‘commercially compelled’ to support the Government's decision to phase in the pay rises, as the Government is the funder.

Stage 3 pay rises

The FWC's Stage 3 decision was as follows:

• Personal Care Workers (PCW): an increase of 18.2% to 28.5% (inclusive of the 15% interim award);
• Assistants in Nursing (AIN): an increase of 17% to 24.5% (inclusive of the 15% interim award), and
• Home Care Workers: an increase of 13.3% to 21.1% (inclusive of the 15% interim award).
• Indirect care workers: up to 6.96% inclusive of the 3% for indirect care workers.

The pay rises apply to workers on the Aged Care Award 2010 and the Social, Community, Home Care and Disability Services Industry (SCHADS) Award 2010. A decision on the Nurses Award is pending.

The Federal Government will now have to find the funding to cover the cost of the initial wage rises taking place from 1 January next year. While Treasurer Jim Chalmers had indicated in May that funding was reserved for future wage increases for aged care and childcare workers, the Budget papers were lacking on detail.

"The 2024–25 Federal Budget delivered on 14 May 2024 has presumably allocated funding for the aged care sector based on this decision (although that is not clearly discernible on the face of the budget papers)," noted the FWC decision.