Payments to the aged care workforce under the government’s COVID-19 retention bonus grant will be taxed, the government has announced.
The $234.9 million COVID-19 Workforce Retention Bonus Grant, which was announced on 20 March by Minister for Aged Care and Senior Australians Richard Colbeck, entitled eligible residential aged care workers up to $800 after tax per quarter and up to $600 after tax per quarter to home care workers for two quarters (read our story here).
However, the government announced on Friday that the payments made to eligible aged care staff, will be taxed.
Eligible residential aged care staff include direct care workers providing clinical and personal care and allied health workers.
Minister for Aged Care and Senior Australians Richard Colbeck said the payment is considered income and will be taxed.
“The retention bonus of up to $600 for eligible home care workers and up to $800 for eligible residential care workers payable for two quarters is income and as such is subject to income tax,” Senator Colbeck told Australian Ageing Agenda.
“This is consistent with other COVID-19 measures, such as JobKeeper,” he said.
Senator Colbeck said the amount of tax an individual pays will depend on their marginal tax rate.
The Government also received backlash from provider and worker representatives, who called to expand the retention bonus to include laundry, cleaning and catering staff in residential aged care (read our story here). This was also backed by federal opposition leader Julie Collins.
“There are no plans to change eligibility arrangements,” Senator Colbeck said.
Provider peaks displeased
Leading Age Services Australia CEO Sean Rooney said the government broke a promise to the aged care workforce.
“The Government said in black and white that frontline residential care workers would be paid up to $800 after tax, while home care workers would be paid up to $600 after tax. Now, as the payments are about to start the rules have changed, with all payments subject to tax,” Mr Rooney told AAA.
“In practice, this sees workers out of pocket by up to $200 or more,” Mr Rooney said.
He said the change will be disappointing to the aged care workforce.
“We call on the Government to honour their promise to aged care workers and not tax this payment,” Mr Rooney said.
Aged and Community Services Australia CEO Patricia Sparrow backed Mr Rooney’s comments and said the government has short-changed the aged care workforce.
“This has been simply mean-spirited and misleading. Workers were led to believe the payments would be more generous,” Ms Sparrow said.
“The government has short-changed some of the nation’s hardest working people on some of the lowest wages,” Ms Sparrow said.
Ms Sparrow said frontline aged care workers deserve the best possible support.
Announcement is ‘stingy’ and an ‘insult’
The Health Services Union national president Gerard Hayes said the taxable payments will leave those eligible hundreds of dollars worse off.
“This is sneaky and stingy. The Federal Government is splashing cash all over the place and recently discovered it had a spare $60 billion. To now claw back hundreds of dollars from the lowest paid, hardest working people in our society takes a special kind of cruelty,” Mr Hayes said.
“Throughout this pandemic aged care workers have exposed themselves to a deadly, unknown pathogen. They have literally compromised their own health in order to care for the elderly. Many of these workers could have earned more on the JobSeeker payment, but nonetheless have fronted for work,” he said.
Mr Hayes said the government needs to reverse the decision to make the payments taxable.
“The Federal Government needs to do the right thing. Extend the payment to all workers and honour the commitment to pay the full amount,” Mr Hayes said.
Mr Hayes said eligibility for the payment was already too narrow.
“The COVID-19 virus didn’t discriminate but the Federal Government did. To now pare it back even further with a tax grab is inexcusable,” he said.
United Workers Union director Carolyn Smith said the announcement is unfair to the aged care workforce.
“The devil is in the detail, and the detail of has revealed a mean, tricky and divisive scheme which is an insult to hard working aged care staff,” Ms Smith said.
“Workers are hugely disappointed now that they have seen the details and feel like they’ve been tricked on tax being removed,” she said.
Australian Nursing and Midwifery Federation federal secretary Annie Butler said the bonus was intended to recognise the dedication and commitment of aged care workers.
“Just as we’ve gained control over the pandemic, aged care workers have weathered that storm and we’re on the path to recovery, the Government has backflipped on its promise, which was in writing to every aged care worker, and now said ‘we don’t actually think you’re worth the full amount’,” Ms Butler said.
Find out more about the grant here.
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aged care workers have a difficult job at the best of times . it is a very low paid industry. never any positive feedback. we get verbally and physically abused each shift we do . more and more staff are leaving this industry . politicians are seen sitting having a cup of tea with elderly ( normal residents ) go down to the dementia ward and see the real picture . now a broken promise is devastating showing just what they think our worth is .
What can I say? Annette sums it up perfectly. Depressing, despairing, sad. They will claw back every bit of the meagre salary we get. If you think anything will change – it never does. It’s so demoralising.
I agree with Annette. The payment is pathetic and the Royal Commission is onto the “boy’s club”… They know that female-dominated industries are lower paid because our work is not valued in the same way male-dominated industries are. Yet, who looks after your parents, your children, an older you?
And Minister Colbeck really doesn’t get it… Government needs to make this payment available to ALL Aged Care industry workers.
Else, perhaps we “not so essential after-all” workers should go on STRIKE and see how fast Covid19 rips through Aged Care facilities and how much our residents all depend on the relevant support staff, when there is:
1 – No one to man the front doors to stop visitors bringing the virus into the facility (Reception staff)
2 – No one to provide meaningful leisure and lifestyle support to promote living a meaningful life with dignity and purpose (Leisure and Lifestyle Staff)
3 – No one to vet contractors to ensure they have had their flu shot (Maintenance)
4 – No one to clean the facility after each and every visitor has attended (Environmental)
5 – No one is there to source, prepare, cook and feed residents nutritious meals (Catering)
Good luck getting the “Front line staff” – I mean Nurses, to cover all those bases…
If the virus is NOT in the facility already: We ARE the Front Line!!!
As an aged care worker personal care staff during the coronivrius pandemic we all put our lives on hold didn’t see our children grandchildren family and friends kept all the restrictions in place to make our residents safe as they are the ones at most at risk so we did all the protocols and guidelines by department of health and while the government always look after the rich and not the hardworking Frontline workers even jobseekers get paid more than most of the hardworking health workers also government looked after airlines gave them millions of dollars but are taxing a retention bonus for health care Frontline workers this is not fair Mr Morrison you government people are well looked after your families are well looked after by the government but Frontline workers that probably look after your grandparents or your mother’s and fathers or sisters and brothers but no you have to reverse your decision and tax Healthcare workers retention bonus rules for rich then crap rules for hardworking health care workers that protect the elderly very disgraceful
Once again aged care workers are under valued, caring for the aged is not an easy job at the best of times and the pay well ask any nurse , people think if you work in aged care its because your not good enough to work in a hospital, I trained in a hospital and worked in one for many years in all wards and areas , now we really know what our worth is and add insult to injury our registration fees this year also went , is that to be donated so those more worthy .
As a Lifestyle staff member I spend almost all of my day with residents for activities,
Coordinating family visits/contacts assisting feeding residents if required and so so much more. Always with residents.
We all DESERVE the retention bonus from Lifestyle Laundry kitchen and Admin.
Come on…we get so little anyway for doing so much.
And they are not paying it at all for delivery of Commonwealth Home Support Program (CHSP) services which are the same services delivered under Home Care Packages just funded differently. Seems like a sleazy way of avoiding paying much at all to these workers who have gone over and above right through this crisis ???
Very disappointing outcome Agecare nurse myself I don’t think they understand the impart the pandemic had on the elderly or the carers even today they are isolated in there rooms sit apart no conversations with other residents staff don’t have time to sit because of under staff and trying to do basic care it’s very sad to see some of our bright bubbly age withdraw scared and sad , then I go home to an empty house lockdown can’t see my daughter who is a single mum of 2 in lockdown who is also doing it tough and I can’t help her because of the risk, it’s a shame we are not worthy but our job is for love for the human and that’s why the government gets away because if we walkout or stop work we are abandoning of duties and who will care for our elderly or drive our ambulance etc , I’m sure the big pay packets won’t care as I’m sure their own family won’t be put in care then they will truly see the hard work and dedication to our once vibrated hard working tax paying people that are sadly forgotten
Shame on you there should of been more carers etc employed at this horrendous time to help them with the heavy burden due to the lack of TIME
This whole thing re payments to all staff on the front line get a bonus … why are cooks kitchen and cleaners not on the list . I work in age care and I tell you we are right on the front line helping with meals cleaning and chatting and keeping there spirits up. Our res residents would miss us all if we weren’t at work. We are the worst paid in the industry getting about $23.50 per hour … some staff are earning the same as the dole .. this whole industry needs to be looked at and we all need a pay rise … Duty of Care …
ESSENTIAL WORKER ?! Apparently not ! I work in the laundry of an aged care facility. I have worked right through this pandemic, not missing a day, along with ALL my colleagues. I have to abide by the same rules, same practices, new conditions. Even had the flu shot for the first time in my life, as the SAME people who are dishing out this bonus deemed it MANDATORY for ALL aged care workers ! Insulting now that it’s not MANDATORY for me and some of my other colleagues to ‘qualify’ for the bonus. I personally have lost all interest, care, motivation and incentive to even go to work any more , and to give my usual 110%. Look out if everyone else feels the same! And I know there’s a lot that do !! Class system ! Discrimination! Two words that come to mind.
Graham 25 June 2020 at 3:30 pm
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The union has a lot to answer for in the Aged Care business,in the way that the rights of their members are being eroded and the way that the same members are being treated by their employers and the Union.
Why is the payment being allowed to be taxed,with the union not even attempting to show some leadership?
Why is it employers do not pay correct penalty rates for overtime,in complete reverse of what the workplace award states?
Why is it employees are not paid for doing higher classification duties,as the award states?
The union is a party to these signed agreements,yet it sits in the background and does nothing as it’s members work their butts off to help some of the most vulnerable members of our society.
The employees in the business need,and deserve,better representation from these fully paid so called workers representatives in these challenging times now and in the future.
It is very unfair that cleaners in aged care will not get the bonus. We have fronted up to work every shift plus extra shifts, put our own health at risk, isolated ourselves from family and friends, stayed away from shops etc to keep the residents safe. We are cleaners who have had a lot of extra work to do extra disenfecting all touch points. We are in close contact with residents while cleaning rooms, helping residents whenever we can, chatting with residents, helping serve and clean up after meals, many of these things are not part of our job role but we do it for the residents yet we do not qualify for the bonus. Are we inferior to carers. Without us who knows what germs would of spread through the facilities
What the hell do they think they are doing frontline aged care workers my foot who do they think takes on all the extra work with COVID cleaning and cleans all the touch points after the residents have coughed up a lung all over them, who do they think the residents grab when there are no nursing staff around, who do they think washes all their contaminated clothing cause it sure as hell is not the nurses cleaning and laundry staff are also risking their lives fronting to work during this pandemic and are now being told their work isn’t worth anything that they don’t deserve to be equal
Well, well, well….just goes to show how valued we are!
Maybe I’ll give up my job as a residential aged care worker and go on jobseeker then?????
Lets see the fun if that was to happen, across the board…NOT happy, I hope all you politicians enjoy your “business lunches” while discussing this!
Who looks after YOUR elderly????? Not you, thats for sure…..try it!!!!!!!
It’s more then the RN’S etc that deserve this payment..I am a Client Services Assistant and our workload rose with Sanitising of all dining rooms and common areas,monitoring visitors and risking our own health..Our cleaners workload rose as well and neither staff were allocated extra time to do so..Our Carers who do all the hard work deserve it too but the paper pushers get a pat on the back with two bonuses..Not fair..
Reading other comments I forgot to mention I too self isolated,two weeks before lockdown,I alienated myself from family and friends..I bought masks and wore whenever I went out..Our facility had no masks at one point and no staff was wearing them most of the time when it was bad..My experience so far is its everyone but the RN’S etc doing the important day to day care and nutrition,we are the ones making the difference and are the ones there for our residents needs..To see others on Centrelink getting what I earn a week when they have not been affected by Covid and yet they deny us two payments and rub salt in the wound implying our work wasn’t important enough and descriminating against our roles..l
I have left two comments which are no different then others so why are they not allowed up they are gone
Hi Leanne,
All comments are moderated before being published. This is done by a human during business hours.
What a disgrace! I worked both in home care and residential facilities where I get verbally and physically abused by both family and clients and get paid $22 an hour. I pay my taxes every year. We are always understaffed and to fill this gap, I have to work harder to meet my allocations list plus more. Not only is this unsafe but we constantly get harassed by our managers that all the bells should be answered (in a matter of seconds). It all goes down to the poor carers who work their arse off! We have missed birthdays, christmas, new years and all public holidays just to take care of your mum and dad. We have followed all the health and safety protocols during this pandemic. And to get taxed with this bonus is absolutely disgraceful. Frontliners deserved more!!
I work as a casual in aged care and also receive the aged pension. The pension payed fortnightly varies on my gross amount I earn in that fortnight. I report that amount. The bonus paid will increase my gross earnings and my question is; Will that increased gross amount decrease my pension payment even further? I’ve been unable to find out anything from Centrelink. I have to add that the wonderful facility I work for decided they will pay all workers the bonus not just the care staff.
My wife works in aged care on a permanent part time basis. Two days ago she received a bonus of 480 dollars which was taxed just short of 100dollars. Then she has to ring this through to centrelink who then take 50 cents in the dollar. 100 dollars tax,240 dollars taken by centrelink, 340 $ out of 480 $ gone. 140$ retention bonus my bum.more like a don’t work bonus. This is so wrong!
As a pensioner partner of an aged care worker, on whose income my aged pension payment is based as I earn no income, not only is the retention bonus to be taxed but will also will reduce my pension as I have to include the full retention bonus as part of my wife’s income. So in fact after tax and pension reduction the promised $800 is really a lot less.
If we are ” all in this together ” why are aged care workers not considered as heroes who are working in difficult conditions, like other health workers? Support workers are taking risks, forced to wear masks and have to manage clients who are sometimes worried by the STRANGE people who arrive to care for them. Life is harder for most workers right now.. Please give aged care workers the Bonus promised, without tax.
The statement “a fish rots from the head down” means leadership is the root cause of age care failure and demise. Another Government back flip. We workers are set up to fail. We are demoralised, the pay in this sector is low, many young people do not want to work for $22.00 per hour therefore not interested in working in age care. Ageing vulnerable people wanting to leave Residential care and if they do … waiting 7 months for level 1 home care packages and up to 36 months for level 3-4 another Government back flip… Richard Colbeck has to go now! and a few others who are all in this together!
My daughter loves her guests as she calls them. She has 4 children and has worked so many hours due to others being sick, no agency allowed and staff leaving in droves. She got her bonus of $560 after psying $240.tax. As long as there is empathy and humanity in great staff, you are going to be screwed by aged care owners and gov. If we were to treat children in such a manner there would be absolute anarchy. The only way it will change is when you have ratio to client and an hourly rate at $25 min. You will have to strike for it. !! I have never seen so much greed thrown at the elderly. There a cash cow for large buisness. I would rather see elderly in 5 shared bedroom homes and cared for in a homely setting. Gov gives on average $75000 yearly a resident plus $25000 yearly from the resident themselves. Ill let you do the math ..its time for change. Thankyou for the love and support you give residents. Its so appreciated.
I agree that it shouldn’t be taxed but think it’s unfair that hospitality and cleaners in aged care homes didn’t get this incentive. These people have alot to do with the residents and came to work through the whole of the covid as well. We had to adopt a resident to spend time with because their families couldn’t be there to which we gladly did. The cleaners were always in the rooms, we were all front liners. Us not being eligible for the incentive was a sting but not to be recognised or considered is worse.
Thanks for the $800,after extra tax,my wife wasn’t paid her carer allowance for our disabled son,I lost my part pension payment,If lucky left with about $200 extra
Made her feel very appreciated
I was paid $480 gross and taxed $156 … net $324?? why so high a tax ..
I am on the MEANs tested aged pension. My wife has busted her guts with only 2 days leave since the start of Covid because of Staff shortages. As a result of the MEANs test and the higher tax bracket we get next to nothing of these payments. She is apparently not alone as many of her colleagues are in the same boat.
As with Kay Reid, and Martin, I am a Personal Carer in aged care receiving the Aged pension, I received $320 bonus for hours worked ,paid tax then declared my bonus at Centrelink and was promptly deducted per fortnight for 12 mths. because of the gross amount earnt.
How low can the Liberal/ National Party Government get? What a miserable way to treat those poor underpaid and overworked ,short staffed workers, in The Front Line against the war on the pandemic,Getting RAT Tested every day, wearing masks all day , As well, I will lose nearly all of my Part aged pension, as I have report to CL’ , each fortnight, my wife’s gross salary to determine my part Aged Pension, WE will ALL remember this on election day 21/5/22