Aged care workers in Australia are finally set for a pay rise

The Australian government has acknowledged aged care workers' demand for more pay.

The Albanese Administration promised to foot the bill for any potential pay rise for aged care workers in a submission to the Fair Work Commission (FWC).

The independent wages umpire called for a 25 per cent pay increase for 200,000 workers, alongside arguments that the current award rates do not reflect the value and skills of the sector. 

This push has come due to exacerbated pressures placed on the sector due to the Covid-19 pandemic, as well as the recommendations of last year’s Royal Commission into Aged Care Quality and Safety.

Minister for Employment and Workplace Relations Tony Burke said: "Right now, there is no doubt their work is undervalued. We need to change that.”

It has been argued that the current wages do not provide enough of an incentive for people to seek work in the aged care sector, leading to workforce shortages that hinder the level of care received by Australia’s elderly population. 

Modelling from the Health Department suggests the sector needs to increase by 6.6 per cent a year over the next five years to meet the growing demand. 

Separate modelling from the Treasury Department also found a 25 per cent increase in wages could increase labour by between five and 10 per cent.

Aged Care Minister Anika Wells said an increase in wages was crucial to addressing these shortages. 

In a joint statement with ministers Tony Burke and Mark Butler, Wells said: “If we don’t start paying aged care workers properly, we won’t be able to attract and retain enough staff to care for our loved ones as our population ages."

She added: "One of the main causes of the gender pay gap is low pay and poor conditions in care sectors like aged care, where the majority of workers are women.

"Increasing wages in aged care is essential to ensuring that men and women are paid equally."

This change could see the minimum wage for aged care workers rise by at least $5 an hour, increasing from $23.09 to $28.86 an hour, depending on salaries when the application was lodged. 

For a level one aged care worker, this could see their weekly pay increased from just over $800 to more than $1,000, per the union's proposal.

However, this case has been before the FWC since 2020, and is due to hear from the government and unions at this month's hearings.