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There are currently over 120 modern awards in operation throughout Australia, and determining which modern award, if any, covers your employees can be an incredibly complex and intimidating process. However, you must understand which award applies to your employees to determine the required terms and conditions of employment, including:
- the relevant minimum rate of pay;
- when penalty rates and overtime are applicable; and
- what allowances are payable.
There are multiple modern awards that may be relevant to aged care providers, including the Aged Care Award 2010 (Aged Care Award) and the Social, Community, Home Care and Disability Services Industry Award 2010 (SCHADS Award). This article will step you through which of these awards is likely to cover your business and other key clauses you should be aware of.
Aged Care Award
Coverage
The Aged Care Award will cover your employees if you operate in the aged care industry. The award defines the aged care industry as the provision of accommodation and care services for aged persons in a:
- hostel;
- nursing home;
- aged care independent living unit;
- aged care serviced apartment;
- garden settlement;
- retirement village; or
- any other residential accommodation facility.
Therefore, if your business provides accommodation or care services to aged persons in any of the above areas, it is likely that the Aged Care Award will cover your employees at the industry level.
This factsheet explains how the ACLA works and how you can sponsor talent into your aged care business.
Classification
You must determine whether Schedule B of the award will cover your employees’ occupations. The classifications account for employees across various levels of seniority in your business who perform:
- general administrative assistance, including receptionists, drivers, gardeners and cleaners;
- food services, such as cooks; and
- direct care.
Where your employees fit into any of the above categories, and the Aged Care Award broadly covers your business, it is likely that this will be the applicable award dictating your employees’ entitlements.
SCHADS Award
Coverage
When you determine whether the SCHADS Award covers your business, you should be aware that there is a specific exclusion for employers otherwise covered by the Aged Care Award. Therefore, if you have determined that the Aged Care Award covers your business generally, the SCHADS award cannot apply. Otherwise, the SCHADS Award covers employers throughout Australia in the:
- crisis assistance and supported housing sector;
- social and community services sector;
- home care sector; and
- family day care scheme sector.
The award defines each of these terms in the definitions clause. For the purposes of this article, the most relevant sector is the home care sector which is defined as the provision of care to an aged person or a person with a disability in a private residence. Specifically, it will cover employees who undertake:
- personal care;
- domestic assistance; or
- home maintenance.
Classification
As with the Aged Care Award, once you have determined that the SCHADS Award generally covers your business, it will be relevant to determine whether your employees are covered by the classifications contained in Schedules B through E.
Unlike the Aged Care Award, there are no administrative streams in the classifications, and therefore, it is likely that the only workers covered by the SCHADS Award are those with carers responsibilities within the relevant sector.
It follows that if the SCHADS Award covers your business at the industry level and your workers are employed as carers, these employees will likely be covered by the SCHADS Award. However, employees who are engaged to perform a different function within the business, such as a company receptionist, will typically be covered by a different occupational modern award.
Continue reading this article below the formWhy is It Important to Get It Right?
It is essential in the highly regulated industry of care providers that your business understands which award covers your employees. This is because the applicable award will dictate all additional employee entitlements beyond those stipulated in the Fair Work Act 2009 (Cth).
The first and one of the most crucial differences between these awards is in the relevant minimum rates of pay. This is often at the front of your employees’ minds and easy to note when incorrect. Further, there are significantly more allowances provided under the SCHADS Award compared to the Aged Care Award, and even the allowances that are common between the two may be calculated differently. Therefore, where you incorrectly determine award coverage or classification, this can lead to underpayment of wages and allowances.
If employees report this to the Fair Work Ombudsman, they may order you to back pay these employee entitlements, and financial penalties may apply.
There are also differences with respect to:
- rostering; and
- paid or unpaid breaks.
If the Fair Work Commission finds that you have contravened a provision of the applicable award, you may again be subject to financial penalties.
Key Takeaways
Award coverage and classification is an incredibly complex area of the law; however, it is important to get it right. Where your business primarily provides aged care services, the first award to consider is the Aged Care Award. The primary consideration as to whether this award or the SCHADS Award will apply is the place where the provision of care takes place.
It is essential to correctly determine award coverage and classification to ensure that you are:
- using the correct minimum rates of pay;
- aware of all allowances owed in accordance with the relevant award;
- compliant with your rostering requirements; and
- otherwise compliant with other obligations conflated under the applicable award.
If you have any questions regarding which award will cover your aged care workers, our experienced employment lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.
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