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Do you struggle to keep up with the SCHADS Award?
If you do, you're not the only one.
The process of 2026 has been one of the busiest years on record in the Social, Community, Home Care and
Disability Services Industry Award 2010 (SCHADS Award) and the Fair Work Commission (FWC) has released
three sets of changes within a few weeks of each other. Let's take a look at what has changed, when each change
kicks in, and then, the good news: CareMaster's SCHADS Award interpreter, built right into our software,
eliminates the guesswork in award calculations to free up more time for your payroll admin and more time for
delivering great care.
This year there are three different trends affecting the SCHADS Award: New rules for sleepover shifts, a general
wage increase as a result of the Annual Wage Review, and a comprehensive restructuring of the entire classification
and pay structure. They all have their own time line and service providers must have all three to remain compliant.
The first change is to the treatment for pay and rostering purposes of sleepovers, which is from the first full pay
period on or after 1 June 2026.
There was real doubt that an overnight sleep over was a break between 2 shifts or if it was that the work done prior
to the sleep over and the work done after the sleep over was one shift. At various times the Federal Court and the
Fair Work Commission had reached opposite conclusions on this issue, and many providers continued to lack clarity
on the way work rosters should be organised and how overtime should be calculated.
The Commission has now resolved the issue. The new clause 25.4 of the Award deems a sleepover to be a break
from shifts. The work immediately before the sleepover and the work immediately after the sleepover is considered
one single shift, and two separate periods of active work are recognised within it. Penalty is no longer cumulative,
but is charged for each active work period in the overnight period.
Meanwhile, the staff and the employers became a bit more flexible. If a shift occurs right before and after a
sleepover, they may now mutually agree in writing, to extend the normal hours from 10 to up to 12 hours prior to the
sleepover and no more than 8 hours after the sleepover before overtime kicks in. The rate of sleep over allowance
has not been altered and will continue to be paid at 4.9% of the standard rate and active work done during the sleep
over will continue to be paid in accordance with the applicable rate.
This is one of the more operationally important changes for the year for providers with an overnight component,
especially those in disability accommodation and in-home aged care. Rosters, payroll configuration, employment
contracts and agreement clauses about sleepovers need to be checked to ensure they are in line with the new rules.
The Fair Work Commission released its Annual Wage Review decision for 2026 on 2 June 2026, which included a
4.75% rise for minimum wages across all modern awards including the SCHADS Award. The rise is from the first
full pay period on or after 1 July 2026.
This increases the National Minimum Wage to $26.44 an hour or $1,004.90 a week for a 38-hour week. About
100,000 of the lowest paid award dependent workers in the country were paid a modestly higher 6% increasing their
wages closer to the rest of the workforce.
The real impact on pay is a 4.75% increase for most SCHADS covered employees, based on their classification level
instead of the National Minimum Wage, and across all streams and pay points of the Award. There are a few
allowances and loadings that are also being re-indexed and providers should ensure that they have the correct pay
rates for each classification by consulting the Fair Work Ombudsman's updated pay guide (SCHADS pay
classification MA000100) before the first pay run of the new financial year.
It's worth noting that this wage increase has occurred in the same week as two other significant changes to payrolls,
namely the transition to Payday Super, which involves paying the superannuation on top of payroll from 1 July
2026, and the rise to unpaid flexible parental leave. If providers are looking to review their payroll system for the
SCHADS increase, they should review all three at the same time.
Of the three developments, the most important is the structural one. The Fair Work Commission has announced its
eagerly awaited outcome in the gender-based undervaluation review of the SCHADS Award, which commenced in
June 2024 to assess if the pay and classifications of female-dominated care and community sector roles are
undervalued.
The Commission was satisfied that they were and has responded by radically changing the Award. The existing five
classification schedules (Schedules B, C, E and F, etc.) will be replaced by one unified Final Classification Structure
(FCS). Once the new classifications are in place, the current Equal Remuneration Order will be repealed as it will no
longer be necessary to use alongside the new classifications.
The changes will be implemented in two phases:
From 1 October 2026:- The disability home care category (Schedule E) will see some interim pay increase, around
15%, prior to the full reform. The Commission has called this a "temporary measure" and further submissions from
interested parties remain pending.
From 1 October 2027:- The new Final Classification Structure will be in full force and replace all of the existing
schedules. Employers will have to identify each impacted worker and match them to the new organization structure
according to their responsibilities, skills and experience, not their current job title or classification label.
For providers it is a significant effort. The Commission has included pay protections to ensure that some workers'
rates do not go into reverse during the transition, and progression will be determined by time in service and not
hours served, plus formal recognition of relevant lived experience. Despite this, many organisations will likely need
to take over a year to do the reclassification exercise itself, the process of reclassifying all roles against the new
structure, modelling the impact on costs and the updating of payroll systems, properly. Nonetheless, it will likely
take many organisations many months to complete a reclassification exercise, reviewing each role against the new
structure, modelling the cost impact and updating the payroll systems, adequately.
These classifications and rates may be further impacted by the ASU's separate work value application that is
currently in front of the Commission, and providers should continue to monitor the process up until 1 October 2027,
while taking into account changes between then and now.
These SCHADS changes aren't happening in isolation. The Children's Services Award is in the process of staged
pay increases for 2026 – many of the roots of undervaluation that affect other awards, such as the Aged Care Award,
affect the Children's Services Award as well – and Aged Care Award rates are trending in a similar direction in the
context of the related Aged Care Work Value Case. If your organisation has staff working on more than one of these
awards, looking at them individually may not be the best way to look at them as the timing and mechanics are
slightly different for each award.
You can access the material underlying the Fair Work Commission and the Fair Work Ombudsman:
Changes to sleepovers in the SCHADS Award – Fair Work Ombudsman
Minimum wages increase from 1 July 2026 – Fair Work Ombudsman
SCHADS Award pay guides – Fair Work Ombudsman
CareMaster offers award interpretation software designed specifically for the healthcare sector, with seamless
integration to industry-leading payroll processes, such as Xero, MYOB and KeyPay. Designed to eliminate the
uncertainty and due diligence of paying employees correctly, this solution assures that you remain compliant and
saves valuable time and effort in the process.
The new sleepover shift rules and the 4.75% Annual Wage Review increase have been incorporated into our
software and our team is continuing to work through the implications of the upcoming Final Classification Structure
for CareMaster clients, in anticipation of the 1 October 2026 and 1 October 2027 dates. In CareMaster's absence,
keeping up with SCHADS changes turns into a much easier task, because of the fact that it is not a scramble every
time the Fair Work Commission announces a new decision.
You can no longer trust spreadsheets, manual checks or a hodgepodge of workarounds – with CareMaster,
classification changes and staged wage increases and shift rule updates are handled correctly and on time. This is
particularly significant for employers who have a combination of aged and disability carers working at different
times, as a single misclassified carer can add up subtly to a much bigger problem in the future.
With three separate rate changes landing across 2026 and 2027, going through your worker list and updating pay
rates one profile at a time simply isn't realistic, and it opens the door to manual errors at exactly the moment
accuracy matters most. CareMaster lets you bulk upload the latest award pay rates across all affected workers in one
action, rather than editing each worker's profile individually every time the Fair Work Commission hands down a
new decision.
This means that when the 4.75% Annual Wage Review increase, the Schedule E interim rise, or a future Final
Classification Structure update comes into effect, you can update pay rates for your whole workforce in bulk and
push those changes through to your payroll platform, including Xero, in a fraction of the time manual updates would
take. For a full walkthrough, see our guide on how to update worker pay rates in Xero after an Award pay rates
update.
If your organisation also delivers NDIS-funded supports, don't forget that NDIS price limits are updated separately
via a Service Import in CareMaster. See our guide on how to update the NDIS prices after a new price guide for the
full step-by-step process.
We've also rolled out a range of other improvements to make managing these changes easier. Check out our latest
software release overview to see what's new.
Driven by the desire to reduce the audit process stress for notifying Award rates and preparing your organisation for
what lies ahead? Schedule a free demo today and experience the pain-free way CareMaster can help providers keep
their customers satisfied and pay their bills. No matter the number of changes or obligations the Fair Work
Commission brings this year, let us show you how to simplify your processes.
Disclaimer: The information contained in this article is correct at the time of writing (9 July 2026) and is prepared by
CareMaster Pty Ltd (ABN 13 651 241 897). It is designed to offer general guidance to employers and employees and made in
good faith. The information contained in this article is not a substitute for professional advice and should not be used as such.
The reforms of the 2026 SCHADS Award are still pending submission and determination by the Fair Work Commission in
respect of some of the components of the 2026 Award, including the Schedule E interim increase and the Final Classification
Structure, and additional information may be provided which could impact upon these classifications. CareMaster Pty Ltd
assumes no liability for any inaccuracies in the information and is not liable for any loss or damage that may result directly or
indirectly from the use of or dependence on, the information contained in this article. Before making decisions, or taking any
action, based on the information provided, readers are advised to make their own study and seek professional advice and refer to
the Fair Work Ombudsman's website for the latest informatio
CareMaster would like to acknowledge the Traditional Custodians of the land on which we operate, and pay our respects to their Elders past and present.
