Major SCHADS changes expected July 2022

If you don't regularly refresh the Fair Work Commission website, you might have missed the 'final determination' on the Social and Community Services Award. For some big changes in the pipeline, there has been very little fanfare.

In the second half of 2021, the Fair Work Commission did their 4-yearly review of the SCHADS Award, to assess what changes are needed to create reasonable conditions for workers in the disability sector. There were many submissions from stakeholders including employers, peaks and unions. The Fair Work Commission’s decisionwas announced on 31 January.

Here are the key changes you need to be across:

Effective from 1 July 2022

These changes will be effective from 1 July 2022, or the first pay period after that. Five months might seem like a long time, but I have a funny feeling life will throw us a few Covid curveballs between now and then. And some of these changes, as you will see below, are quite significant.

Minimum shift of 2 hours

Closing a gap in the previous Award, there are now minimum engagement periods for part-time and casual workers. Staff undertaking disability services work will need to be rostered (or at least paid for) shifts that are a minimum of 2 hours long. Readers playing along at home will note that NDIS supports are generally delivered and billed by the hour, not in 2 hour blocks.

But there is a transitional period from 1 February 2022 to 1 October 2022, to give employers and employees time to negotiate changes to shifts. This transition period applies to arrangements in place before 1 February 2022 only.

Workers to be paid for broken shifts

A broken shift is defined as a shift with one or more breaks (that aren’t meal breaks) within a 12hr period. For example, if a worker is rostered from 8am to 11am, then 2pm to 6pm, that would be considered a broken shift. This one was a big ticket item for many providers – with lots of submissions calling the proposed broken shift changes incompatible with the NDIS pricing model.

Workers will now be paid an additional allowance of 1.7% of the standard rate per broken shift, or 2.25% of the standard rate for two unpaid breaks in shifts in a 12 hour period. The Award does not specify an allowance for more than two unpaid breaks, or indicate whether these will be allowed.   

Worker reimbursement for client cancellations

Under the changes, if a client cancels a service rostered for a full or part time employee within 7 days, the employer must either find an equivalent shift for the worker or pay them the full rate. There’s also several conditions on when that equivalent work (or what the Award calls ‘make-up time’) can occur, how much notice employers need to provide, and the kind of make-up time that can be offered.

Given the Short Notice Cancellation rule in the NDIS Pricing Arrangements is currently only 2 clear business days, this will be one of the most challenging changes for providers.

Working outside of hours

Submissions from employee representative groups were clear that there needs to be some acknowledgement of when work creeps into the non-work lives of employees. And Fair Work seems to agree. Under the changes, there will be a scale of minimum payments for employees performing remote work outside of their rostered hours and designated shifts. This scale ranges from 15mins of pay, to 275% of the minimum hourly rate in certain circumstances.

Overtime rates and on-call allowances

The Award provides some clarity about overtime rates. There is also a minimum engagement period of 2 hours for workers who have left the workplace and are called back to work. Where an employee is required to be on-call, they will be paid an additional allowance of 2% of the standard rate for weekdays or 3.96% of the standard rate for public holidays.

Widespread changes to an Award can be complicated for providers to implement, even in a market that is relatively stable-  which ours isn’t right now. The incentive will be to roster on larger teams to support a single participant, to avoid paying a broken shift allowance. But this may have flow on effects on the relationships between workers and participants. Changes to the Aware might also encourage providers to hire casual employees instead of full-time or part-time workers or use EBAs to define employment conditions.

The ball is now in the NDIA’s court. You would hope that the Pricing Arrangements will be adjusted to match changes to the Award. But the NDIA are not strictly legally obligated to make the changes, and we have reason to be skeptical that they will. In the history of the Scheme, there are several circumstances where the pricing model did not align with industrial instruments. So really, what happens next is anybody’s guess.

You can read the full determination here. Watch this space for more DSC content on how providers can operationalise the new Award conditions.

NB: The original version of this article used an example of a broken shift where the worker is supporting the same participant. Please note, the decision does not indicate broken shifts are exclusively defined when the worker is supporting the same participant.