60,000 nurses working in aged care are set to benefit from the Fair Work Commission's (FWC) latest wage rise, taking their pay higher than nurses working outside the sector – but providers will be expected to fund part of the associated leave liabilities out of their own pocket.
Under the wage rise, a level 1 nurse working in aged care in their first year will earn a minimum rate of $35.41 per hour, compared with $29.60 per hour for a level 1 pay point 1 RN not working in aged care, a difference of nearly 20%.
A Department of Health and Aged Care (DoHAC) webinar heard on Tuesday (18 February) the Independent Health and Aged Care Pricing Authority (IHACPA) will update its pricing advice to Government on Friday (21 February) to reflect higher wages for nurses.
Once the Government receives the advice, it will provide updates for the AN-ACC price and 24/7 Registered Nurse Supplement. The new rates will apply from 1 March, the date the pay rises take effect.
The Fair Work Commission decided last December nurses working in residential aged care, including Registered Nurses (RNs) and Enrolled Nurses (ENs), would be awarded wage rises of between 4.2% and 25.5% (on top of the 15% previously granted).
The increases take effect in three tranches: 1 March 2025, 1 October 2025, and 1 August 2026 with the second and third tranches of the pay rises to be included in IHACPA's 2025-26 pricing advice.
Attestations required
Karen Hall, Director, Aged Care Workforce Branch with the DoHAC, acknowledged in the webinar that receiving the information so close to implementation "could impact these changes being made in time for 1 March".
She said, as for previous wage increases, providers will be required to attest in quarterly financial reports that all funding provided to implement higher nurse wages is passed on to workers. DoHAC will "continue to closely monitor" providers' attestation responses, which are published online, she said.
Home care
For home care, Rachel Blackwood, Assistant Secretary, Home Support Operations Branch, DoHAC, said Home Care Package subsidies will increase by 0.1% from 1 March and a further 0.31% on 1 October 2025, and another 0.48% on 1 August 2026 to cover the cost of the wage rise.
CHSP
Commonwealth Home Support Program (CHSP) providers will be delivered through a one-off payment covering the wage increase between March and June 2025.
"Providers will receive a formal notice of change during March relating to this contractual change," Rachel said.
Leave liabilities
The increase in the AN-ACC price will only cover part of the on-costs including leave.
Karen said historical leave liabilities will be funded in the same way as stages two and three of the award wage increases through grants covering: 25% for residential aged care and 50% for all other eligible providers.
However, grants for leave liabilities are only planned to open in October 2025, meaning providers will have to pay the remaining entitlements out of their own cash until the grants are released.
The Department also flagged that it plans to monitor the grants closely for over-claiming.
Karen said providers should retain HR and financial reports used to complete the grant applications for two years as the DoHAC will be auditing a sample of providers.
"The audit process will seek to recuperate funds from providers if the HR and finance reports do not appear to support the information in the workforce capture template," she said.
Aged care providers can call the Fair Work Line on 13 13 94 if they require assistance.
