A major Fair Work Commission decision is set to increase award wages and update classifications across five female-dominated industries.

TLDR:

In summary it has been determined that allied health professionals have long been undervalued despite their higher qualifications and increased work complexity when compared for example to trades roles which are historically male dominated industries. 

It has also been determined that wage levels should be reclassified to address these disparities, especially with regard to the professional autonomy and multi-disciplinary responsibilities that these professionals hold.

Increases of approximately 25% to minimum wages have been recommended – with Fair Work yet to decide on the final values, classification changes or timeframe – but it will likely occur over 3+ years. 

Read on for the nitty gritty details…. 

Recent Changes and Focus on Gender-Based Undervaluation of Work

In recent years, there has been a growing focus within Australia’s industrial relations landscape on gender-based undervaluation of work, particularly in sectors dominated by female employees, such as healthcare and social services. This shift stems from broader legislative changes introduced by the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022. These amendments emphasize gender equality as a key objective in ensuring fair pay across industries.

The Fair Work Commission (FWC), as part of its mandate, is tasked with addressing any imbalances where work historically performed by women has been underappreciated or underpaid relative to roles traditionally dominated by men.

What did the Fair Work Commission decide?

This has resulted in the Fair Work Commission reviewing 5 key sectors over the past 12 months, they have just released a landmark ruling finding that in these female dominated industries there is not equal pay for work of comparable value. These changes aim to ensure that remuneration accurately reflects the qualifications, skill sets, and responsibilities involved, irrespective of historical gender biases.

The FWC’s focus on gender-based work value is therefore designed to provide equal pay for work of equal or comparable value, eliminating gender-based undervaluation in these professions, and addressing long-standing pay gaps.

In light of this finding, the FWC has proposed significant increases to minimum award rates and changes to classification structures to better reflect the true value of the work performed in these sectors.

This decision is expected to help close the gender pay gap by lifting award rates across a range of occupations, including allied health professionals, dental assistants, pharmacists, early childhood educators and other health workers.

What information was presented to Fair Work during the review? 

The review saw submissions from a variety of stakeholders, including employer associations, unions, and industry representatives. A key point of debate was the financial impact of proposed changes. Some industry bodies and private practices, particularly those in smaller clinics or private healthcare settings, expressed concern over the financial strain that could result from the proposed wage increases.

They noted that many health professionals work in privately funded practices, where fees for service are tightly controlled, and there may not be the budget flexibility to accommodate higher wage costs without impacting the overall business model. These entities requested government support, particularly for NDIS and aged care providers, arguing that if funding rates did not increase proportionally to cover these wage adjustments, there could be significant financial challenges in continuing to offer services at sustainable rates.

Unions, on the other hand, emphasized the increased workload and complexity of roles in the allied health sector, which had expanded due to greater client needs, specialized interventions, and multidisciplinary collaboration. They argued that without addressing the undervaluation of qualifications, the industry would continue to see high turnover rates, as workers pursued opportunities outside the sector in better-compensated fields.

Comparison to Other Awards and Industry Impacts

The FWC’s decision included comparisons to other modern awards, particularly those in male-dominated industries like the Metal Industry Award and other technical sectors. By comparing allied health professions to these sectors, the FWC noted that the C10 Metals Framework (which had been used to set benchmarks for male-dominated, trade-based work) resulted in misalignment for allied health professionals, who required higher qualifications yet were often compensated at a lower rate than those in male-dominated technical fields. These discrepancies were particularly evident when comparing the work done by allied health professionals with similar roles in pharmacy and other degree-level occupations.

The proposed reclassification will adjust this by introducing a simplified classification structure for health professionals and a wage increase that reflects the work value and qualification requirements for these roles.

Allied Health Professionals and Feedback on Occupational Groups

The FWC’s review covered all allied health professionals listed in the Award, some of these included psychologists, physiotherapists, occupational therapists, speech pathologists, and dieticians.

Allied health roles, which often require undergraduate and postgraduate qualifications, were similarly found to be undervalued in terms of work value and remuneration. The unions representing these professions highlighted that the expanding responsibilities in client care and professional development warranted better recognition, especially as the complexity of cases and clinical demands have grown over time.

Some of the industry bodies, particularly those representing private practice owners and clinics, raised concerns that the proposed increases would significantly affect their profit margins without sufficient government funding support, particularly in community-funded sectors such as NDIS and aged care. There was a consensus that if government reimbursement rates for these services were not adjusted accordingly, the financial sustainability of such businesses would be at risk.

Key Findings of the FWC’s Review

The FWC‘s review highlighted that gender-based undervaluation was a key issue within the health professions covered by the HPSS Award. The decision also stressed that:

• Allied health professionals, including those in diagnostic and therapeutic roles, had long been undervalued despite their higher qualifications and increased work complexity.
• The review found that historical wage-setting practices, including reliance on the C10 Metals Framework, failed to adequately compensate for the professional qualifications required in allied health, where roles often demand undergraduate or postgraduate degrees.
• Reclassification of roles was seen as essential to address these disparities, especially with regard to the professional autonomy and multi-disciplinary responsibilities that these professionals hold.

Provisional Views on Potential Implications

The FWC’s provisional views include several key changes that would likely be implemented:

1. Health Professionals (Allied Health):
   • Reclassification of health professionals into simplified structures that reflect both qualifications and experience. For example, an AQF Level 5 qualified individual with 4 years of experience will be compensated differently than an individual with AQF Level 7 and the same years of experience.
   • The proposed classification will align wages for AQF Level 7 employees (e.g., allied health professionals) with the C1 benchmark identified in the Stage 3 Aged Care Decision.
   • For example, an AQF Level 7 professional would see their wage raised to $1525.90 per week, with further adjustments by June 2025.

Classification Criteria	AQF 5 (Diploma)	AQF 6 (Advanced Diploma)	AQF 7 (Bachelor)	AQF 8 (Masters)	AQF 9 (Doctorate)
Entry Level – 1st Year	1147.80	1239.90	1449.20	1493.10	1593.60
2nd – 3rd Year	1207.80	1305.10	1525.90	1571.70	1677.50
4th – 6th Year	1315.30	1421.30	1661.20	1711.10	1760.90
7th Year +	1421.60	1536.10	1796.50	1894.40	1903.20

How does this compare to current classifications and rates of pay?

2. Support Services Employees:
   • Roles like dental assistants, pathology collectors, and laboratory technicians will also see reclassification, with their wages adjusted to better reflect the qualifications and responsibilities for their roles.
   • Dental assistants, for instance, will be reclassified into Levels 1, 5, 6, and 7, depending on their level of experience and qualification.

The changes for Pharmacy Industry Award have already been announced and will occur in three phases, with an overall 14.1% wage increase across the board. This increase will be implemented incrementally over the next three years (30 June 2025, 30 June 2026, and 30 June 2027). This phased implementation will allow employers in the sector time to adjust to the financial impact of these changes.

There will also be changes to SCHADS if you have any employees engaged under that Award. 

Next Steps

The FWC will now invite submissions on the provisional views and any feedback regarding the implementation dates, including phase-in periods for wage increases. These submissions will help shape the final decision. The Commission is expected to finalize these changes and begin implementing them by mid-2025, with an eye toward addressing long-standing gender-based undervaluation and improving remuneration fairness for allied health professionals.