Budget 2024: Union warns pay rise delay will create staff crisis

The Australian, 15 May 2024

Unions have attacked the government’s attempt to stagger pay rises for aged care workers over two years, warning the delay would plunge the sector into quicksand.

The Health Services Union released a new survey of workers that found 35 per cent would consider quitting the aged care sector if the increases were held back.

The government has made a multibillion-dollar commitment to fund pay rises for aged care and early childhood workers but has urged the Fair Work Commission to phase in the wage increases of up to 13.5 per cent in aged care in two stages in 2025 and 2026.

Health Services Union national president Gerard Hayes said aged care workers were “bitterly disappointed” by the government’s bid to stagger the pay rises.

“If the government insists on delaying this pay rise it will plunge aged care into quicksand,” Mr Hayes said. “The workforce is already crumbling and this will make it worse.”

In a recent HSU survey, more than 1500 aged care workers were asked: “If the pay increase is delayed would you consider leaving the sector?” Some 35 per cent of respondents said “yes, I would consider leaving the aged care sector”. A further 43.36 per cent said they “might” consider leaving.

The HSU quoted from then ­opposition leader Anthony Albanese’s budget reply speech in 2022 when he said: “Unlike this prime minister who won’t take any responsibility, a Labor government won’t muck around. We’ll support the workers’ call for better pay at the Fair Work Commission.”

The HSU’s NSW assistant secretary, Lauren Hutchins, urged the Prime Minister and Treasurer Jim Chalmers to reconsider the delay.

“Aged care does not have 18 months to spare,” she said. “This survey shows the workforce is already teetering on the brink. After the extraordinary high of winning a pay rise that delivers justice and dignity, we now face the prospect of a delay that will see the sector shed workers.”

ACTU president Michele O’Neil said the peak union body backed the HSU’s concerns about the need for pay rises to be implemented urgently.

Ms O’Neil said it was important that the government had made provision in the budget to fund the pay rises for aged care and early childhood workers.

Aside from deliberating on the timing of the aged care pay rises, the commission is considering an ACTU claim for a 9 per cent minimum wage increase for workers in female-dominated industries as part of the annual wage review.

Unions and employers also want the government to fund pay rises flowing from a yet to be finalised multi-employer agreement across the early childhood sector.

New Australian Bureau of Statistics data on Wednesday showed the wage price index rose 0.8 per cent in the March quarter, and 4.1 per cent for the year, down slightly from the 4.2 per cent increase in the 12 months to December. It is the first time there has been three consecutive quarters of at least 4 per cent wage growth since 2008.

Treasury forecasts annual wages growth will fall from 4 per cent to 3.25 per cent over the next two financial years before rising to 3.5 per cent in the subsequent years of the forward estimates However, lower forecast inflation will deliver real wages growth of 0.5 per cent for two years and 1 per cent from 2026-27.