The Early Childhood Education and Care Worker Retention Payment
The Australian Government is funding a 15% above award wage increase for all eligible early childhood education and care (ECEC) workers through the ECEC Worker Retention Payment (Payment).
The wage increase will be phased in over a two year grant period, with eligible ECEC employees receiving a:
- 10% increase from December 2024
- further 5% increase from December 2025.
The Payment is administered by the Department of Education. Visit the Department of Education's website at Early childhood wages for more information about the Payment and how to apply.
Grant eligibility
Eligible ECEC employees include workers employed in a Child Care Subsidy (CCS) approved Centre-Based Day Care or Outside School Hours Care service who are:
- covered by the Children's Services Award or the Educational Services (Teachers) Award, or
- primarily performing duties covered by one of these awards but who aren't actually covered by the award (for example, because they're covered by a different award or instrument).
ECEC providers must satisfy certain criteria to be eligible to receive the Payment. This includes that a provider must:
- have a legally enforceable workplace instrument in place:
- until at least the end of the grant period (November 2026)
- that includes an obligation to pay workers at least 10% above current award rates
- provides for an additional 5% above applicable award rates from 1 December 2025
- take all reasonable steps to employ all eligible ECEC employees at their service under such an instrument (employers generally need to engage at least 95% of employees under such an instrument to be eligible)
- provide information to all eligible ECEC employees on the types of compliant workplace instruments.
Detailed information about eligibility criteria is available in the ECEC Worker Retention Payment Grant Opportunity Guidelines (Guidelines). The Department of Education also has information about workplace instruments and bargaining.
Workplace instruments
A workplace instrument isn't defined in the Guidelines.
Examples of workplace instruments referred to under the Fair Work Act include:
- enterprise agreements
- individual flexibility arrangements (IFA)
- state industrial instruments.
An award is another type of workplace instrument. An award on its own doesn't satisfy the funding eligibility for the Payment, but an IFA made under an award, which changes the operation of certain terms of an award, may be able to.
Enterprise agreements
An enterprise agreement is a type of workplace instrument that is made between employers and their employees that sets out pay and entitlements for employees covered by the agreement. Once made and approved by the Fair Work Commission, an enterprise agreement replaces any awards or previous agreements that would otherwise apply to those employees.
If an enterprise agreement applies to you but doesn't meet the Payment's eligibility criteria, you may be able to:
- seek to vary the enterprise agreement
- in some circumstances, seek to bargain for a new enterprise agreement, for example if your agreement has passed its nominal expiry date
- make an IFA.
An enterprise agreement can cover one employer (single-enterprise agreement) or multiple employers (multi-enterprise agreement) and some or all of their employees.
Single-enterprise agreements
An employer can make a single-enterprise agreement with its employees. A single-enterprise agreement may cover employees:
- employed at the time the agreement is made
- who start work for the employer after the agreement is made.
Multi-enterprise agreements
Two or more employers can make a multi-enterprise agreement. The multi-enterprise agreement is only made with employees who:
- are employed at the time the agreement is made
- will be covered by the agreement.
A multi-enterprise agreement can be a:
- supported bargaining agreement
- single interest employer agreement
- cooperative workplace agreement.
Multi-enterprise agreement for the ECEC sector
On 10 December 2024, the Fair Work Commission approved the Early Childhood Education and Care Multi-Employer Agreement 2024-2026 (Agreement). The Agreement is a supported bargaining agreement which will apply to 60 employers in the ECEC sector and their employees.
The Agreement will start on 17 December 2024 and has a nominal expiry date of 30 November 2026.
We understand that the Agreement contains pay rates that will meet the eligibility criteria for the Payment.
This Agreement can be varied to add employers and their employees to the coverage. If an employer becomes covered by the Agreement, they will need to comply with it. Failure to comply with the Agreement could have a range of consequences, like investigations, court proceedings or serious financial penalties.
Learn more on the Fair Work Commission's website at Early childhood education and care supported bargaining agreement.
Individual flexibility arrangements
An IFA is a written agreement used by an employer and an individual employee to change how certain clauses in their award or enterprise agreement operate.
An employer should keep a copy of the signed IFA and give a copy to the employee.
An IFA doesn't need to be approved or registered with the Fair Work Ombudsman or the Fair Work Commission.
An IFA can be used to meet the genuine needs of both the employee and employer. An IFA must result in the employee being better off overall compared to their award or enterprise agreement.
An IFA must meet the requirements of the relevant award or enterprise agreement clause.
We can't provide advice on how to make an IFA that complies with the payment guidelines. For more information about complying with Payment guidelines, visit Department of Education - Early childhood wages.
The rules about making an IFA can be found in:
For more information, access our:
- Individual flexibility arrangements best practice guide
- Individual flexibility arrangements library article.
State Industrial Instruments
Some employers that aren't covered by the national workplace relations system may be able to become eligible for funding through other workplace instruments made under state or territory laws.
Please contact the relevant agency in your state or territory for more information.
Roles of the Fair Work Ombudsman (us) and the Fair Work Commission
The Fair Work Ombudsman (us) and the Fair Work Commission are independent and separate government organisations.
Fair Work Ombudsman
We are the national workplace relations regulator. Our role in relation to enterprise agreements includes:
- providing advice on pay and conditions in an enterprise agreement
- assisting parties to resolve disputes about entitlements in their enterprise agreement
- recovering underpayments and guiding parties to comply with their enterprise agreement
- taking action to enforce compliance with an enterprise agreement, where required.
We have general information about enterprise agreements, including:
- who they apply to
- finding an enterprise agreement
- making an enterprise agreement
- the Commission's role in supporting agreement-making.
