The Fair Work Commission (FWC) has finalised a landmark decision to address gender undervaluation in the Social, Community, Home Care and Disability Services Industry Award 2010 (SCHADS Award), confirming major changes to pay rates and how workers are classified across the sector.
The ruling follows a detailed review that found existing SCHADS Award classifications and wage rates had been undervalued, and the current system was “not fit for purpose”.
At the centre of the decision is a new, simplified classification framework that will replace multiple existing schedules, alongside phased wage increases for affected employees.
What's changed?
For employers, the changes mark a significant shift, requiring a reassessment of workforce classifications, payroll systems and labour costs.
A new, single classification structure will replace Schedules B, C, E and F from October 1, 2027, bringing social and community services, home care and disability roles into one integrated framework.
Ahead of that transition, current Schedule E employees (Home Care – disability services) will receive a 15% pay increase from October 1, 2026, with further adjustments required when the new structure comes into effect.
The FWC has also clarified where key roles sit within the new framework, setting wage benchmarks for entry-level positions and confirming classification outcomes for occupations across the sector.
Importantly, the decision rejects several proposals that would have added further cost or administrative complexity for employers, including automatic progression based on hours worked and expanding the classification structure to additional occupational groups.
The FWC has also moved to retain the monetary value of allowances, rather than allowing them to increase in line with wage changes, limiting flow-on cost escalation in some areas.
For SCHADS businesses, the focus now shifts to implementation, including workforce mapping, financial planning and preparing for a staged transition to the new structure over the next two years.
Employers covered by enterprise agreements underpinned by the SCHADS Award will need to consider how the new structure impacts on base rates of pay under the agreement and plan for potential adjustments to current wages and in any future agreement negotiations.
While the reforms aim to simplify classification and better reflect the value of care work, they also introduce a new layer of operational complexity that employers will need to carefully manage.
SCHADS decision: what employers need to know
What’s changing
- New single classification structure to replace Schedules B, C, E and F
- Designed to simplify classification and address gender undervaluation
Timing
- October 1, 2026: 15% increase for Schedule E employees
- October 1, 2027: New classification structure takes effect
Key classification outcomes
- Entry-level disability support workers set at Level 2.2
- Entry-level SCHADS children’s services workers set at Level B.2
- Case workers/practitioners aligned to Level 5
What the FWC rejected
- Automatic progression for part-time/casual employees based on hours
- Extending the new SCHADS structure to clerical roles in home care and crisis accommodation
- Introducing a standalone counsellor definition, and inclusion of it at a specific classification
- Senior crisis assistance and supported housing workers being covered under level 9 and 10 of the new classification
Pay and allowances
- Further wage increases to flow with the new structure
- Allowances retained at current monetary values (not uplifted with wages)
- Pay protection to ensure existing employees are not worse off
What employers should do now
- Review workforce classifications against the new structure. This includes employees covered by enterprise agreements underpinned by the SCHADS Award.
- Model cost impacts across 2026-27 and beyond
- Prepare payroll systems for staged changes
- Review contracts of employment to determine any changes required
- Communicate changes and timelines to staff
Business Law WA can provide legal advice on Award compliance, interpretation, agreement negotiations and payroll audits. Please contact [email protected] or call 08 9365 7560 to arrange complimentary consult.
This article is authorised by Business Law WA, an incorporated legal practice and wholly owned subsidiary of CCIWA. The content of this article is general in nature and is not legal or professional advice and should not be relied upon as such.
