Early Childhood Education and Care Update: Grants for Worker Retention Payments

Employment and Industrial Relations

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DATE PUBLISHED: November 11, 2024


key takeaways

  • The Commonwealth Government has launched a $3.6 billion grant scheme to support a 15% wage increase for early childhood education and care (ECEC) workers.
  • Eligible ECEC providers can now apply to participate in the scheme, with applications open until 30 September 2026.
  • Worker retention payments will be distributed from 2 December 2024, with regular payments starting in January 2025.

OVERVIEW

ECEC employers, including outside school hours care (OSHC) providers, can now apply for the “Worker Retention Payment” grant scheme. This $3.6 billion initiative introduced by the Commonwealth Government aims to support a 15% wage increase for ECEC workers over a two-year period. Eligible ECEC providers may opt-in by applying for the grant via the Department of Education online portal. Submissions are open until 30 September 2026.

TIMELINE

  • Applications: Open now until 30 September 2026.
  • Payment period: From 2 December 2024 to 30 November 2026.
  • Regular payments: January 2025.

ELIGIBILITY CRITERIA


To participate, ECEC Providers must:

  • Be approved for Child Care Subsidy (CCS);
  • Operate Centre Based Day Care (CBDC) or OSHC services;
  • Meet the following grant conditions:
  • limit fee increases to no more than 4.4% between 8 August 2024 and 7 August 2025;
  • pass all grant funding directly to eligible workers through wage increases; and
  • engage workers through a valid workplace instrument (such as an Award, Enterprise Agreement, or Individual Flexibility Arrangement).

Providers must also meet the reporting requirements by completing and submitting an annual declaration financial statement comprising of (1) a declaration, confirming you have used all funding in compliance with grant conditions and (2) a financial statement including total expenditure on wages and on-costs.

WORKPLACE INSTRUMENTS REQUIREMENT 

A key condition is that workers must be engaged through a recognised ‘workplace instrument’ (such as an Award or Enterprise Agreement). This ensures that the grant funding is accurately distributed to eligible employees. Common law contracts are not considered valid workplace instruments.

How mcw can help

With the grant scheme commencing on 2 December 2024, it is essential for eligible providers to assess whether participation aligns with their business needs. Those interested will need to act promptly to ensure the required workplace instruments are in place.

Our Employment and Education teams at McInnes Wilson Lawyers are available to help you navigate the scheme, understand the terms and requirements, and identify any changes you may need to make (or agree to make) to participate in the scheme.

If you are interested in receiving more information about the grant scheme, please reach out to one or our team members on:

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