Time to give Supported Employment the Pub Test

Written by Phil Hayes-Brown, Wallara Chief Executive Officer

We’ve all seen the headlines calling for closure of supported disability enterprises – “$4 an hour Sweatshop!” and heard passionate advocates, often with disabilities themselves, calling for these workplaces to be closed, some claiming they are akin to modern slavery. These claims keep coming. 

So how can it be that the Disability Royal Commission was split on this subject, Australia’s Fair Work Commission believes these workplaces are important and I personally am proud to lead an agency offering these jobs to 250 adults in Melbourne who live with intellectual disabilities?

I invite you to join me on a journey to unpack the full story of supported employment and see if it passes that iconic Australian measure, the pub test. Let’s begin. 

First, we need to talk about the Disability Support Pension, the DSP. To qualify for the DSP someone needs to be assessed by Services Australia under a range of criteria including age (must be 16 or above) and a list of medical and non-medical rules which are all about assessing someone’s ability to work.

One of the qualifying criteria is: you have an intellectual disability with an IQ of less than 70.

As reference, my adult daughter qualifies for a DSP on this ground and all of Wallara’s supported employees receive the DSP.

At its core then, the DSP ($1150 a fortnight , $575 per week or $30K per annum and not taxable) is a work income supplement. 

If someone on a DSP wants to work, then the DSP rules say they can earn up to $200 a fortnight before they start losing some of their pension. For every dollar a DSP holder earns from working over $200 a fortnight, they lose 50 cents from their DSP. Yes that’s right – a 50% tax! – but lets stay focused. 

Secondly, we now need to explain Supported Employment which employs 20,000 adults across Australia and uses a pro rata wage tool that was created by the Federal Govt and endorsed by the Fair Work Commission. It basically says if someone with a disability can do half the job of someone without a disability then they get half the regular hourly rate. 

Clearly, assessing output like this isn’t easy, but that’s a rabbit hole we aren’t going to dive down either. The assessors are all trained and independent so for now let’s assume they give it their best. 

An assessment of 20% means the worker receives 20% of the regular Award rate which equates to $4.80 per hour.

This is where those sweatshop headlines come from. 

And an assessment of 80% means they would receive about $18 an hour. The average hourly rate nationally is $8. 

If Lucy works 20 hours per week , then she will earn $96 on top of her DSP (20 x $4.80) so her weekly income is $575 + $96 = $671 per week , nearly $35K per year, and its tax free. This work income (wages plus DSP)  is often called a social wage. On an hourly basis, Lucy’s social wage works out at $33 compared to the regular Award hourly rate of $24.

Note Lucy also receives health concessions, rent assistance and NDIS funding, but we are just talking about her earnings from work. 

That covers the 2 main pieces of evidence for this pub test. 

Let’s go a little deeper now and  I’ll use my own workplace to cover these. 

What sort of work? We offer our crew jobs like picking and packing, sorting and folding laundry, mowing lawns and managing gardens or working in our cafes. Some of the crew love doing one thing and others mix it up. We find the best jobs with the best companies we can. St Kilda Footy Club is one example – we handle storage and pick/pack/shipping  of all their merchandise and we mow lawns at their footy grounds. LendLease is another. 

Who helps Lucy? We employ and train Job Coaches who are paid to support Lucy and her mates in their jobs and help them enjoy their work. Each Job Coach supports a few workers at a time and uses their skills and experience to make it all function as much as possible like any other workplace. 

What’s Lucy think of it? Most days Lucy says she likes it. Some days one of her workmates does something to upset her, and the Job Coach has to step in and sort it out. Along with the work, Lucy enjoys the social banter, talking about the footy and has made some good friends. She likes being part of a team, has pride in her work and feels like she belongs. 

So there it is pub patrons. Time to decide what you think is fair. 

Lastly in closing, I should disclose I have a Lucy in my family and I love the idea of her having a paid  job. While I love seeing more employers being open to employing people with disabilities on full Award wages, not all disability types are the same. I want all the Lucys and people like her all across Australia to enjoy the dignity of work because a job gives so much to someone. 

The case for Supported Employment now rests.

I await your verdict. 

And if you want to come along and take a look yourself before you decide, you are welcome to visit anytime.