In March 2013, the Australian government announced it was reforming the national aged care system in an effort to ensure residents received improved residential and community care services.
As part of this announcement the government announced increased funding of $1.2 billion to assist aged care employers to attract and retain staff by increasing wages and improving employment conditions. The $1.2 billion over a three year period is to be delivered in two parts, firstly through the Aged Care Workforce Compact and secondly through the development of a new funding arrangement for the aged care sector.
The Australian Nursing and Midwifery Federation (ANMF) worked closely with the Australian government on the policy arguing that additional funding to the residential aged care sector specifically targeted to improving the wages and employment conditions of aged care staff would improve the attraction and retention of employees to the sector, enhance existing work practices and lead to improved levels of care for residents and clients.
This article provides information about the Workforce Supplement, a key part of the Aged Care Workforce Compact to improve the working life of aged care staff.
Why is there a need for a specific policy in the aged care sector?
Until the late 1990s, nursing staff employed in the private and not-for-profit aged care sectors in all states and territories earned broadly the same wages and employment conditions as nurses in both public and private hospitals. This was because all nurses at the time were paid in accordance with minimum awards which were consistent across the country.
In the late 1990s awards were progressively replaced by enterprise agreements that covered employees at their workplace. The ANMF was able to secure agreements on behalf of nurses employed in the hospital sector but struggled for some time to secure comparable agreements in the aged care sectors. There were a range of reasons for this, but primarily it was due to the strong membership the ANMF enjoyed in the hospital sector compared to the relatively low membership at the time in aged care. Further, where ANMF were able to secure enterprise agreements on behalf of nurses and carers in aged care, they typically provided for inferior rates of pay and working conditions.
The consequence of all this was that the wages of workers in aged care fell behind those elsewhere and aged care employers struggled to attract and retain staff and this had a negative impact on the ability of the sector to maintain high levels of care.
What is contained in the Aged Care Workforce Compact?
The Compact sets out the eligibility requirements for providers/aged care employers to access the additional Commonwealth funding to improve wages for nurses, carers and support staff.
Firstly all providers and operator establishments which have 50 or more operational places must have an enterprise agreement or commit to an enterprise agreement with their aged care staff. For those providers with less than 50 places they must enter into a contract with the Department of Health and Ageing and commit to meeting all of the compliance requirements.
Whilst there was strong opposition by aged care providers to the need to have an enterprise agreement, the ANMF successfully argued that an enterprise agreement being a legally enforceable arrangement is the only way the government can ensure that employers pass on all the money to their aged care staff.
Secondly, all aged care providers must provide a minimum employer funded wage increase of 2.75% (or the Fair Work Commission increase, whichever is higher) each year. They must also maintain wages above the minimum award rate of 3% for AINs and PCAs, 8.5% for enrolled nurses and 12.6% for registered nurses.
Thirdly, there must be improvements to workplace conditions in regard to:
- access to training and education;
- professional development;
- union representation leave;
- a process to review part-time hours;
- arrangements to convert casual employees to permanent employees;
- provisions for work load management;
- workplace health and safety arrangements; and
- disciplinary matters.
An approved provider of residential care services that meets the eligibility requirements set out in Compact will receive Workforce Supplement funding equal to:
- 1% of the basic daily subsidy in 2013/14;
- 2% in 2014/15;
- 3% in 2015/16; and
- 3.5% in 2016/17.
As this additional funding is intended to go directly to the wages of aged care staff it is expected that by the end of 2016, the Aged Care Workforce Supplement will ensure staff have received a significant boost to wages of approximately: • $29.00 per week or $1,510.00 a year for personal care workers and AINs;
- $35.00 per week or $1,820.00 a year for enrolled nurses; and
- $46.00 per week or $2,390.00 a year for registered nurses.
However it is important to note these increases are based on national enterprise agreement averages and will vary as enterprise agreements provide for different wage rates from state to state and from enterprise to enterprise.
|Fair Work Commission annual minimum wage increase*||2.60%||2.80%||2.50%||3.00%|
|Annual wage increase||2.75%|
|Margin above award wage||4.00%||8.00%||12.60%||12.60%|
|Required wage at Margin above award wage||$25.96||$27.71||$29.61||$30.50|
|Supplement (1% each year, 0.5% in 2016-17)||$0.37||$0.39||$0.42||$0.22|
|Wage increase as %||6.05%||6.05%||6.05%||5.52%|
Senior Federal Industrial Officer