Ai Group shares concerns about ECEC’s capacity to meet demands of FWC decision 

Australian Industry (Ai) Group, a national employer association which provides workforce development advice, legal advice, training and development and commentary on workplace relations development, have weighed in on a recent Fair Work Commission (FWC) ruling that sectors and industries which are female dominated have experienced gendered pay imbalances.

The decision is significant for the early childhood education and care (ECEC) sector, which is 97 per cent female, with pay increases of up to 35 per cent potentially to result. 

ECEC professionals, pharmacists, dental assistants, social workers and some health care professionals will be impacted by the ruling which looked more deeply at five awards in female dominated professions. 

Pharmacists are first in line and will get a pay raise of 14.1 per cent, to come into effect in stages between June 2025 and June 2027.

“Today’s Fair Work Commission decision will have a profound impact on employers covered by the awards subject of the proceedings, many of which will struggle to meet the scale of increased costs proposed,” Ai Group CEO Innes Willox said.

“The decision contains provisional views proposing substantial variations to certain awards to address what it has found to be gender-based undervaluation in the minimum rates of pay in the relevant instruments being considered through the proceedings.”

“If the provisional views are maintained, there will be a dramatic increase in costs for affected employers, many of which are small not for profit organisations in mostly government funded sectors that lack any capacity to meet additional costs.”

The Full Bench has proposed a process whereby parties impacted by the ruling will have the opportunity to share their views, something which the Ai Group supports. 

“The Australian Industry Group will now work with industry to determine the potential impact of those views and relevant matters that the Full Bench will need to grapple with,” Mr Willox said.

“At the very least, there will be a need to carefully work through appropriate transitional arrangements. Employers cannot fairly be saddled with unsustainable cost increases at short notice.”

Speaking specifically about ECEC, he added that it was “pleasing that the Commission has recognised that the employers in the early education and care sector are largely reliant on Federal Government support and that an absence of increased funding will result in potentially unaffordable increases in childcare costs for some parents.” 

“In some circumstances, it will no doubt also result in the reduced availability of childcare services,” she added. 

“This is an intolerable situation. Employers, workers and parents will be eagerly awaiting the response of both sides of politics to this issue.”

“What we sorely need is a plan for how the wage increases that have potentially been baked into the system by changes to IR laws will be funded, despite no clear pathway to improving productivity in what is an increasingly uncertain and fragile economic environment,” Mr Willox said.