The Fair Work Commission (FWC) has decided to increase minimum wages and awards by $40 a week from 1 July 2022, benefitting some workers in the disability sector.
The decision follows the Annual Wage Review 2021-22 that assesses both the national minimum wage (NMW) and modern award minimum wages and the Commission says the increase was made due to the “sharp rise” in the cost of living and the “strengthening of the labour market”.
“The increased cost of non-discretionary items such as basic food staples will particularly impact low-income households and many low-paid workers,” says the Commission.
“The Panel concluded that the changes in the economic context weigh in favour of an increase in the NMW and modern award minimum wages.”
From July, the NMW will be $812.60 for a full 38-hour week, or $21.38 per hour, due to the increase of 5.2 percent, and the modern award minimum wage will increase by 4.6 percent to around $869.60 per week or $22.88 per hour.
When submitting to the Commission’s Review, the Australian Council of Trade Unions (ACTU) proposed a 5.5 percent increase, which was rejected by the Commission on the basis that an increase of that size would “pose a real risk of significant adverse effects to the national economy”.
But ACTU Secretary Sally McManus believes that system-wide change is needed to truly support workers on low wages.
“This Annual Wage Review is one tool we have to generate wage growth, but it only affects one in four workers – we need wage growth across the economy,” says Ms McManus.
“Clearly the current system is failing. It is unable to deliver wage increases despite low unemployment, high productivity and high profits. Working people are feeling the serious consequences of nearly ten years of inaction by the previous Government.
“Our country needs to take a fresh look at this problem and address it. It is not acceptable that working Australians and their families continue to go backwards while big business does so well.
“We cannot be satisfied with a wage-setting process that leaves minimum wage workers living in poverty and delivers real wage cuts for the average worker.”
Ms McManus says the wage increase does not “reward or acknowledge” the work of disability support workers during the pandemic, who faced risks to their own health to continue to deliver supports, and will not apply to National Disability Insurance Scheme (NDIS) workers with ABNs.
“More work needs to be done to reform the unit pricing and to ensure all disability workers, whether employees or not, have appropriate rights and protections,” she says.
The Australian Services Union (ASU) advocated for the pay rise on behalf of the social and community services sector, alongside the ACTU.
Assistant National Secretary, Emeline Gaske, says the raise in wages is an important part of addressing workforce shortages and issues.
“This decision is an important win for disability support workers,” explains Ms Gaske.
“It will help many workers put food on the table and keep them working in the sector, which is critically important for so many Australians with disability.”
However, Ms Gaske adds that workforce shortages will still be an issue after the minimum wages increases in July.
“We know from research released earlier this year that almost one-third (31 percent) of disability support workers say they wanted to be in a different job by next year – an alarming figure, particularly given existing workforce shortages,” explains Ms Gaske.
“While wages are a significant driver behind this, poor working conditions are also a major factor, so we need to keep up the fight to make sure disability support workers are treated fairly and can fulfill their vital roles in the best possible working conditions.”
The Health Services Union (HSU), which represents disability support workers, has welcomed the Fair Work Commission’s decision while calling for system change.
National Secretary of HSU, Lloyd Williams, says, “Disability workers deserve every cent and much more.”
“The FWC decision will take an entry level disability support worker from $29.12 to $30.45, which we still consider quite a low wage for the emotionally and physically challenging work that they do.”
Mr Williams says while the increase in wages is good for those it applies to, there are many workers in the disability sector that will not see a difference in their pay.
“Concerningly, the rise of contractor gig work in the disability sector means some workers won’t see a single cent more through the FWC increase,” says Mr Williams.
“This is fundamentally unfair and all workers providing disability support should be provided with wage justice and be able to keep up with the cost of living.”
The FWC has also announced changes in February to the Social, Community, Home Care & Disability Services Award that will introduce a minimum payment for part time disability service workers of two hours from 1 July, 2022.
This means part time workers not reaching two hours in a shift will still need to be paid for two hours of work.
The minimum payment also applies for each working period in a broken shift, so a person working for 90 minutes with an unpaid break before a further two hours of work will need to be paid for four hours of work.