The Fair Work Commission’s ruling in October is set to raise staffing costs across the social and community services and the disability services sector. 

The Fair Work Commission (FWC) has confirmed what many in the Social, Community, Home Care and Disability Services (SCHADS) sector have long known: roles in this female-dominated industry have been systematically undervalued, reflecting historical gender bias in how work has been assessed and remunerated. As a result, the SCHADS Award is set for major reform, introducing a simplified classification and wage system that better recognises the skills, responsibilities, and conditions of employees. These changes are not just about fairness, they will have a direct and significant impact on your organisation’s finances, workforce planning and service delivery.

How these changes affect your budget

For employers, the most immediate impact of the SCHADS Award reform will be financial. The move to a single, streamlined classification and wage system is expected to raise minimum pay rates across many roles. Although these increases are yet to be determined, a 14.1% increase was awarded under the Pharmacy Industry Award as part of the same process. Some commentators have speculated that increases of 20% or more could be seen for SCHADS Award employees.   

Understanding the potential financial implications of significantly higher wage costs is critical, along with considering other potential flow-on effects: 

• Budget and funding adjustments – service pricing, grant applications and funding negotiations will need to reflect higher staffing costs to remain sustainable. 

• Cashflow pressures – organisations may face phased wage increases requiring careful forward planning and cashflow management. 

• Administrative and compliance costs – beyond payroll, you’ll need to invest some time reclassifying staff under the new framework, updating HR and payroll systems and communication changes to staff and stakeholders. 

Historically, government-funded programs that calculate funding based on staff hourly rates (e.g. NDIS services) generally adjust in line with award rate increases. However, organisations with grant funded programs or those that are not government-funded may be more significantly impacted by the proposed changes.  

While these changes may put pressure on margins in the short term, they are also said to create long-term benefits. Fairer pay can help reduce turnover, improve recruitment and strengthen workforce stability in a sector where staffing shortages are an ongoing challenge.

Why the SCHADS Award is changing

On 16 April 2025, as part of its Gender Undervaluation – Priority Awards Review, the FWC’s Expert Panel handed down provisional findings that will reshape the SCHADS Award. The commission found that the current classification system is outdated, overly complex and fails to capture the true scope of work performed across the sector. This has led to pay that doesn’t reflect the true value of roles, reinforcing gender-based wage gaps.  

Key provisional changes include: 

• Removing the existing five separate classification structures, 

• Introducing a single, streamlined classification and wage system, and 

• Revoking the Equal Remuneration Order (ERO) once the new framework is in place. 

The aim is to ensure that the work — much of it carried out by women — is fairly recognised and valued. 

Timing and next steps

Unlike the Pharmacy and Children’s Services Awards, which received immediate adjustments, the SCHADS Award changes remain under discussion. A final hearing is scheduled for October 2025, where the FWC will determine how the new structure will be implemented. The Australian Services Union (ASU) and other stakeholders will contribute feedback before final decisions are made. 

Preparing for change

To navigate the upcoming SCHADS Award reforms effectively, employers should start strategic planning now. This includes: 

• Reviewing workforce structures to understand how new classifications may affect roles. 

• Modelling potential wage impacts to anticipate increases in payroll and budget requirements. 

• Engaging with funding bodies early to discuss adjustments to grants, service pricing, and cashflow planning. 

• Monitoring FWC updates closely, as the final determination in October 2025 will set the official timeline for implementation. 

The SCHADS Award reform is more than just a compliance update, it’s a structural shift aimed at recognising the true value of work in this essential sector. Forward planning will be key to ensuring your organisation remains both compliant and financially sustainable, while supporting a workforce that is fairly values and equipped for the future. 

Need help preparing for SCHADS Award changes?

Our team can assist with workforce financial modelling, projecting wage increase impacts as you consider the financial implications of these changes and cost structure adjustments you may need to consider. Contact us today to discuss how we can assist you prepare for these changes.