SCHADS Award Pay Rates and Progressions Explained

Heads up, more changes are coming. From 1 December 2026, home care disability employees under the SCHADS Award get an initial pay increase of up to 15%. Broader changes, including a new classification structure and updated pay point progression rules, follow from 1 October 2027. The Fair Work Commission hasn't published full detail on the new structure yet, so everything below reflects the Award as it currently stands. We'll update this guide as more information lands.

Read the Fair Work Commission's announcement.

The Fair Work Commission is there to make sure that Australian employers are compliant with their Modern Awards. Unfortunately, these awards can be so complex and highly specific that many employers aren’t actually complying, especially when it comes to the SCHADS Industry Award.

To add a level of complexity to the legal jargon, the award sets a different minimum wage depending on an employee’s occupation level, qualifications, and experience.

Beyond that, each level has its own pay points.

So, you need to carefully consider what classification your employee falls under because this will determine their correct pay rate.

It’s not enough to guess what level or pay point an employee sits at. To help guide you on pay rates and pay point progressions, here’s everything you need to know.

All employees in Australia are entitled to a minimum wage. For employees covered under the SCHADS Award, this means being paid according to their specific classification and pay level.

The SCHADS Award sets minimum pay rates based on the type of work employees perform, their qualifications, experience, and responsibilities. In addition to base pay, employees may also be entitled to:

• Penalty rates for working weekends, public holidays, or late-night shifts
• Allowances for travel, first aid duties, sleepover shifts, and more

The Fair Work Commission reviews and updates SCHADS pay rates every year, typically in July. Staying up to date with these changes is essential for employers to remain compliant.

Need the latest rates? Download our SCHADS Award Pay Rate Cheat Sheet included in the SCHADS Award eBook.

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The SCHADS Award groups employees into four broad employment streams:

• Social and Community Services Employees
• Crisis Accommodation Employees
• Family Day Care Employees
• Home Care Employees

Each of these streams contains classification levels, often referred to as pay levels, which determine an employee’s minimum pay rate. Classifications are based on factors like:

• Skills and qualifications
• Years of experience
• Responsibilities and duties within the role
  

Example: Social and Community Services Employees

There are eight levels within this stream:

• Level 1: Entry-level workers who typically receive substantial on-the-job training. They work under close supervision and perform routine clerical or support tasks.
• Level 4: Employees who hold relevant tertiary qualifications and apply specialist knowledge within their role. They often take responsibility for particular functions or teams.
• Level 8: Senior managers responsible for high-level decision-making and oversight. They generally possess advanced qualifications and significant post-graduate experience.

Each level has a different minimum wage. As employees progress from Level 1 to Level 8, both their responsibilities and pay rates increase accordingly.

Why Classifications Matter
Accurately classifying your employees under the SCHADS Award is critical. Misclassification can result in underpayments, which may lead to legal action, fines, and reputational damage.

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Within each SCHADS pay level, there are pay points that allow employees to progress to higher pay rates without changing their classification.

Pay point progression usually depends on factors such as:

• Length of service (typically 12 months of continuous employment)
• Satisfactory performance
• Demonstrated competency
• Acquisition and use of new or enhanced skills

Progression through pay points provides a structured pathway for employees to increase their earnings over time while remaining within the same classification level.

Example: Level 1 Social and Community Services Employee

An employee at Level 1 might start at Pay Point 1 and progress to Pay Point 3 over time.

• Pay Point 1: Starting point for most new employees in entry-level roles.
• Pay Point 2: After 12 months of satisfactory performance, or if the employee has specific duties (for example, performing a full range of domestic duties, including personal care tasks), they may start at Pay Point 2 instead.
• Pay Point 3: Further progression is possible if competency and performance criteria are met.

Employers must ensure they understand the pay point progression rules within the SCHADS Award and apply them correctly.

Under the SCHADS Award, Level 1 Social and Community Services Employees follow clear pay point progression rules:

• Employees typically start at Pay Point 1, performing entry-level duties under supervision.
• After 12 months of industry experience, they may progress to Pay Point 2.
• Some employees start directly at Pay Point 2 if their duties include a full range of domestic tasks (such as cleaning, food service, and assisting with personal care).

For example, an employee responsible for all domestic duties under general supervision — including cleaning, food preparation, and helping residents with personal care — must be classified at Level 1, Pay Point 2 from the beginning of their employment.

Such employees may then be eligible to progress to Pay Point 3 after a further 12 months of continuous service and satisfactory performance.

Level 2 Social and Community Services Employees

These employees typically have completed an appropriate qualification, such as a Certificate III or IV, and are required to perform work related to that qualification.

Starting Pay Points:

• If the employee has a Certificate IV, they must start at Pay Point 2 from the beginning of their employment.
• Otherwise, employees without a Certificate IV qualification will typically start at Pay Point 1.

Progression:

After 12 months of satisfactory performance and full-time equivalent service, Level 2 employees are eligible to advance to the next pay point, provided they have demonstrated competency and have used any new skills acquired during that period.

Level 3 Social and Community Services Employees

Level 3 employees are generally required to have a three or four-year tertiary qualification relevant to their role.

Starting Pay Points:

• Employees with a three-year degree must start on at least Pay Point 3.
• Graduates with a four-year degree who are performing Level 3 responsibilities must start on at least Pay Point 4.

Progression:

Level 3 employees can move through the subsequent pay points after 12 months of continuous employment and satisfactory performance at each pay point.

Key Considerations:

It’s important to accurately assess qualifications and responsibilities to ensure employees are appointed at the correct starting pay point under the SCHADS Award. Incorrect classification or underpayment at this level can lead to compliance issues and potential penalties.

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The SCHADS Award also specifies pay point progression rules for Crisis Accommodation Employees at Level 1.

Graduates who are required to perform duties directly related to their qualifications and who undertake responsibilities relevant to Crisis Accommodation roles should be paid no less than Pay Point 2.

In these cases, the employee does not start at Pay Point 1, as their duties and qualifications warrant a higher starting pay point.

After 12 months of satisfactory full-time equivalent service at Pay Point 2, these employees are eligible to progress to the next pay point (Pay Point 3), as long as they meet competency and performance requirements.

This system ensures that qualified employees undertaking more complex responsibilities are fairly compensated from the start of their employment.

Who This Applies To

• Social and Community Services Employees at Levels 4 to 8
• Crisis Accommodation Employees at Levels 2 and 3
• All levels under the Family Day Care Employees and Home Care Employees streams

These groups do not have unique progression rules set out in the SCHADS Award. Instead, the general clause governs how they can move through the pay points within their level.

General Progression Rules:

• Employees become eligible to progress to the next pay point after 12 months of continuous service at their current pay point.
• Progression depends on: demonstrated competency in their role; satisfactory performance over the 12‑month period; and acquisition and application of new or enhanced skills, typically gained through on‑the‑job training.

Important Clarification: The Federal Court has clarified that the term eligible does not mean an automatic progression. Instead, it’s at the discretion of the employer to determine whether the employee has met the criteria to move to the next pay point.

Employers must assess employees fairly and reasonably. It’s best practice to implement clear policies and maintain documentation outlining decisions around pay point progression to avoid potential disputes.

Watch for the upcoming pay point progression changes. The Fair Work Commission has confirmed changes to progression rules and a new classification structure for the SCHADS Award, most taking effect from 1 October 2027. Home care disability employees also get an initial pay increase of up to 15% from 1 December 2026. Full detail on the new structure hasn't been published yet, so keep an eye on Fair Work's updates and be ready to revisit classifications once it lands.

Managing SCHADS pay rates and pay point progressions can be complex, but getting it wrong can have serious consequences. Non-compliance can lead to employee underpayments, backpay orders, fines, and reputational damage.

Three Steps to Ensure Compliance:

1. Regularly Review Pay Rates and Classifications
   Rates were last updated on 1 July 2025 following the Annual Wage Review. [Fair Work Ombudsman]
   
   
2. Accurately Classify Employees
   Ensure employees are classified under the correct stream, level, and pay point based on their qualifications, experience, and responsibilities. Misclassification can result in underpayment.
   
   
3. Document and Monitor Pay Point Progressions
   Implement internal policies that clearly outline how pay point progressions are assessed. Keep records of employee performance reviews and progression decisions.

By staying informed and implementing structured systems, you can reduce your risk of non-compliance.

Key Takeaways

• The Fair Work Commission reviews and adjusts SCHADS pay rates annually.
• Pay rates and pay point progressions depend on an employee’s classification level, responsibilities, qualifications, and experience.
• Failure to correctly classify employees or manage progression can result in back payments, fines and penalties from Fair Work, and reputational damage.
• Employers should adopt clear policies for classifying employees and determining progression eligibility, ensuring decisions are fair, reasonable, and well-documented.
• From 1 July 2025, the SG rate increases to 12% of an employee’s ordinary time earnings. This rate applies to all salary and wages paid on or after 1 July, even if some or all of the pay period occurred before that date. From 1 July 2022, the $450 per month threshold for superannuation was removed. Employers must now pay the super guarantee (SG) for all eligible employees, regardless of how much they earn.

If this process sounds overwhelming, Pay Cat can help automate and manage compliance, giving you peace of mind.

Need Help Navigating SCHADS Pay Rates and Levels?

Manually managing SCHADS pay rates, levels, and progression rules can be time-consuming and risky.

At Pay Cat, we provide payroll solutions specifically designed for businesses operating under complex modern awards like SCHADS.

• Automate employee classifications and pay point progressions
• Ensure compliance with the latest SCHADS Award updates
• Reduce the risk of costly underpayment claims and Fair Work audits

Book a free demo with Pay Cat today and see how easy it can be to automate your SCHADS payroll compliance.

Understanding the SCHADS Award can be complex, but having the right tools makes compliance easier. We’ve compiled key resources to help you stay on top of your payroll, rostering, and compliance obligations.

Download the Updated SCHADS Award eBook + Pay Rate Cheat Sheet — Everything you need to know about SCHADS, including wage classifications, pay points, and allowances.

Who Is Pay Cat?

Simplify Payroll. Stay Compliant.
Pay Cat helps Australian businesses take the stress out of payroll and stay fully compliant with modern awards. As Employment Hero Payroll experts, we set up systems that cut down on mistakes, save hours each pay run, and keep your business on the right side of Fair Work.