Fair Work Ombudsman targets aged care in compliance crackdown

The Fair Work Ombudsman (FWO) has announced that it is investigating 20 aged care organisations across Australia to ensure staff are receiving the right pay and entitlements. 

So far, 27 sites across Victoria, New South Wales, South Australia, Queensland and Western Australia have been investigated. The first visits occurred in late February and investigations are ongoing. 

The investigations focus on pay and entitlements for personal care workers, nurses, and nursing assistants, being staff providing direct care to older people in their homes and at residential aged care facilities. Record-keeping is also being assessed.

A spokesperson for the FWO told Hello Leaders that the 20 aged care providers under investigation have been selected based on a range of factors. This includes a history of non-compliance, and/or anonymous reports from staff members, and/or employment of visa holders. 

Common issues for aged care workers requesting assistance from the FWO include the underpayment of base rates of pay, non-payment for overtime and penalty rates, non-payment of allowances, and non-payment of final entitlements upon leaving their employment.

There are also organisations where these factors may not be in play and the reason for investigation is to test compliance or to see if there are service delivery factors affecting compliance. The spokesperson said this is the case for some of the services operating in regional or remote areas. 

As the investigations are ongoing, the FWO cannot comment on any findings, while the spokesperson said no assumptions should be made about any findings that may eventuate.

“The aged care services sector is a priority area for the Fair Work Ombudsman. It is at high risk of non-compliance with workplace laws and engages large numbers of vulnerable workers such as migrant workers,” the FWO spokesperson added.  

“In 2023-24, the FWO recovered more than $40.5 million for over 22,000 underpaid aged care workers in residential aged care. In that financial year, 12% of all the anonymous reports to the FWO were from workers providing health care and social assistance.”

Aged care under the microscope

Since 2015, the FWO has executed 21 Enforceable Undertakings with providers of aged care or disability services. In 2023-24, it entered into two Enforceable Undertakings with two aged care providers – Southern Cross Care (Tas) Inc and Calvary Administration – and an Enforceable Undertaking with St Vincent’s Health Australia, which provides both health and aged care services.

• Southern Cross Care (Tasmania) was required to back-pay almost $6.9 million to staff after it self-reported breaches to the FWO in 2021 following an internal review. 
• The organisation found fundamental errors in its payroll and human resources system which resulted in situations such as part-time employees not receiving overtime pay for additional hours.
• Calvary Administration back-paid more than $2.1 million to staff who were underpaid due to a payroll error prior to the organisation purchasing the company when it was called Japara Administration. 
• Japara Administration self-reported the underpayments in 2020, and the sale occurred in 2021. 
• St Vincent’s Health Australia also self-reported to the FWO in 2021 after identifying that hospital employees in NSW and aged care staff in QLD were underpaid.
• Poor payroll, human resources and governance practices led to the businesses failing to provide employees with their full entitlements under the applicable enterprise agreements between 2014 and 2020.

Migrant workers flagged, but more are at risk

In a statement released by the FWO during the week, Fair Work Ombudsman Anna Booth said improving compliance in the aged care sector was one of the regulator’s priorities.

“The aged care sector employs a high number of vulnerable workers, particularly migrant workers, who are at risk of exploitation, and these inspections are making sure their workplace rights are being met,” Ms Booth said.

“Hard-working aged care workers must be paid all that they are owed under their awards, agreements and the Fair Work Act’s National Employment Standards. 

“If we find breaches, our first aim is to ensure that workers are fully and promptly back-paid. If we find employers with significant compliance issues we’ll consider our enforcement tools as appropriate.

Although Ms Booth’s comment raises the issue of migrant workers at risk of exploitation, the FWO spokesperson highlighted that past examples show that all workers are vulnerable to being underpaid or not receiving appropriate entitlements. 

“These particular investigations focus on pay and entitlements for personal care workers, nurses, and nursing assistants,” The spokesperson said. 

“More generally, the aged care sector is at high risk of non-compliance with workplace laws and engages large numbers of vulnerable workers such as migrant workers. The federal Department of Health and Aged Care’s Aged Care Worker Survey 2024 found that about 43 per cent of aged care workers are migrants.

“Speaking generally, migrants can be unaware of Australian workplace laws or concerned about visa impacts if they seek help. There may also be language or cultural barriers that make it more difficult to raise issues with managers.”

The FWO has resources for migrant and visa holder workers to inform them of their rights and the role the FWO plays in supporting all workers. 

Additionally, the Australian Government has introduced the Strengthening Reporting Protections Pilot and Workplace Justice Visa Pilot to strengthen protections for eligible visa holders experiencing workplace exploitation. Both pilots are being administered by the Department of Home Affairs.

As per the FWO, under the Strengthening Reporting Protections Pilot, Home Affairs won’t cancel a person’s visa even if they’ve breached a work-related visa condition, provided certain eligibility criteria and conditions are met. This includes if the person is pursuing a workplace exploitation matter. 

Both pilot programs require a visa holder to be provided certification from the Fair Work Ombudsman or an accredited third party regarding their workplace exploitation matter. Information on the pilot programs including the certificate can be found on our website or Home Affairs’ website.

How the FWO is supporting providers

While the investigation is concerning on the surface level — no one wants to see staff underpaid or missing out on entitlements — the FWO is committed to helping aged care providers.

The FWO has targeted information on award changes and aged care sector to ensure providers understand the changes to classifications and minimum pay rates for some employees in the aged care sector, which have taken effect in 2025

“We want employers to get it right in the first place. The Fair Work Ombudsman supports employers and employees to identify correct pay and entitlements,” Ms Booth added.

Employers and employees can visit www.fairwork.gov.au or call the Fair Work Infoline on 13 13 94 for free advice and assistance about their rights and obligations in the workplace. A free interpreter service is available on 13 14 50.

The FWO has also established an Aged Care Services Reference Group to support a collective approach to enhanced compliance with workplace laws. 

This reference group consists of senior FWO leaders, the peak aged care provider body Ageing Australia, and unions representing care workers — the Health Services Union, the Australian Nursing and Midwifery Federation, and the United Workers Union. The group’s role is to:

• Provide advice and information relevant to the FWO’s work in the aged care services sector.
• Allow ongoing dialogue with key stakeholders and an opportunity for them to provide advice and feedback to the FWO on workplace relations issues relevant to the sector.
• Identify opportunities for input into, and potential co-design of educational and other regulatory activities for the sector.
• Support the identification of strategic opportunities and initiatives that drive a culture of workplace compliance in the aged care services sector.

Issues can be reported online anonymously, including in languages other than English. Employees can also seek information from their union, if they are a member, or from their employer.