If you employ people under the SCHADS Award, 2026 has already brought several changes to the way some employees are rostered and paid.
And there is more coming.
What the 2026 changes mean for employers
Changes to sleepovers took effect from the first full pay period on or after 1 June 2026. The vehicle allowance increased from the first full pay period on or after 1 September 2026. Further changes to classifications and minimum pay rates have now been announced, including an initial increase for eligible home care employees performing disability care work from December 2026 and broader changes taking effect in 2027.
For employers in disability services, home care and community services, this is a good time to review your payroll setup rather than waiting for the next pay run to expose a problem.
What is the SCHADS Award?
The Social, Community, Home Care and Disability Services Industry Award 2010, commonly known as the SCHADS Award, sets minimum employment conditions for many employees working across social and community services, home care and disability services.
It covers much more than an hourly rate.
Depending on the employee and the work they perform, the Award can affect classifications and pay rates, ordinary hours, overtime, penalty rates, allowances, sleepovers, broken shifts, travel between clients and higher duties.
That means when the Award changes, employers need to look beyond simply updating one number in their payroll system.
If you’re not sure which Award applies to your employees in the first place, start with How to find the right modern award (and why it decides everything else).
What SCHADS Award changes are happening in 2026?
There are several changes SCHADS employers should have on their radar.
SCHADS sleepover changes
Changes to SCHADS sleepovers took effect from the first full pay period starting on or after 1 June 2026.
The changes affect how shifts involving sleepovers are rostered and paid, including ordinary hours, overtime, rest breaks and shift allowances.
Read the Fair Work guidance on SCHADS sleepover changes
A sleepover is a continuous eight-hour period. Where the employer and employee agree, ordinary hours for a shift that includes a sleepover can be up to 12 hours, provided the relevant Award requirements are met. A maximum of eight ordinary hours can be worked either side of the sleepover.
The sleepover period does not break the shift for the purpose of overtime. Work immediately before and after the sleepover is treated as part of the same shift for relevant purposes.
What should employers check?
If your business uses SCHADS sleepovers, review how sleepovers are rostered, ordinary hours before and after the sleepover, overtime triggers, rest breaks, shift allowances and penalties, payroll settings and whether the required agreement for extended ordinary hours is in place.
This is one of those changes where the roster and payroll system need to agree with each other.
SCHADS vehicle allowance increased in September 2026
The SCHADS Award vehicle allowance temporarily increased from $1.01 to $1.05 per kilometre from the first full pay period starting on or after 1 September 2026.
The increased rate applies for six months and ends on 28 February 2027.
Check the current Fair Work information on the temporary SCHADS vehicle allowance increase
This can be particularly relevant to disability and home care providers where employees use their own vehicles to travel between clients or transport clients as part of their work.
Fair Work also provides guidance on pay and allowances under the SCHADS Award.
Read Fair Work’s SCHADS Award pay and allowances guidance
Check your payroll settings
If eligible employees receive the vehicle allowance, check that the correct rate is being used, the $1.05 rate starts from the correct pay period, eligible kilometres are being recorded, the allowance appears correctly on payslips and your payroll system hasn’t retained the previous $1.01 rate.
It sounds simple.
It’s also exactly the sort of small payroll setting that can be missed when a change takes effect.
More SCHADS Award pay and classification changes are coming
On 21 September 2026, the Fair Work Ombudsman published details of further changes to the SCHADS Award following the Fair Work Commission’s gender-based undervaluation priority awards review.
The changes include new definitions, changes to progression between pay points, a new classification structure and changes to minimum pay rates.
Most of these changes will start from the first full pay period beginning on or after 1 October 2027.
Read the Fair Work update on the SCHADS Award classification and pay changes
There is an earlier change for home care employees performing disability care work.
These employees will receive an initial increase of up to 15% to their minimum award rate from the first full pay period on or after 1 December 2026. Any remaining increase to minimum award rates will apply from the first full pay period starting on or after 1 October 2027.
The rates applying from October 2027 will also include any changes resulting from the 2027 Annual Wage Review.
So while October 2027 might seem a long way off, there is already work employers can do now.
What does this mean for your payroll?
The important thing about SCHADS changes is that they rarely sit in isolation.
Think about the chain: Classification → Pay rate → Roster → Overtime → Allowances → Superannuation → Payslip
Change one part and you may need to check the others.
For example, an employee’s classification can affect their minimum rate. A change to the roster can affect overtime or penalty calculations. A vehicle allowance needs to be correctly configured and paid.
That’s why a payroll review should look at the whole setup, not just whether the hourly rate looks right.
If you’re unsure whether you’ve got the right Award or classification in the first place, start with How to find the right modern award (and why it decides everything else).
What SCHADS employers should do now
1. Check which employees are covered by the SCHADS Award. Make sure you know which employees are covered by the Award and which classification applies to each role.
A job title on its own doesn’t necessarily tell you which classification applies.
If you’re unsure, our guide to finding the right modern award explains where to start.
2. Review your current classifications. With a new classification structure coming, now is a sensible time to review your current classifications and understand how they may be affected.
Don’t wait until the change takes effect to discover that your payroll system, employment records and actual duties don’t line up.
3. Check your payroll rates. Compare the rates currently configured in your payroll system against the current Award requirements.
Pay particular attention to employees working different classifications, penalty arrangements or employment types.
4. Review allowances. Check the allowances that apply to your employees and make sure the correct rates are configured.
For vehicle allowances, the temporary SCHADS rate is currently $1.05 per kilometre from the first full pay period on or after 1 September 2026.
Check the current Fair Work vehicle allowance information.
5. Review sleepover arrangements. If your business uses sleepovers, check your rosters and payroll calculations against the June 2026 changes.
Don’t assume an existing sleepover arrangement continues to be calculated in exactly the same way.
Check the current SCHADS sleepover rules with Fair Work.
6. Identify employees affected by the December change. If you employ home care employees performing disability care work, identify those who may be affected by the initial minimum-rate increase from December 2026.
Read the Fair Work update on the SCHADS classification and pay changes.
7. Start preparing for 2027. You don’t need to wait until 2027 to start.
Review your classifications, employee records, payroll structure and current rates now. That gives you time to work through anything that doesn’t line up.
Want to check your SCHADS pay rates?
If you’re not sure what rate should apply, the Fair Work Ombudsman’s Pay and Conditions Tool can help you check minimum rates, penalties, overtime and allowances under the SCHADS Award.
Check SCHADS pay rates using the Fair Work Pay and Conditions Tool
Fair Work also provides current information about SCHADS Award rates and allowances.
View the Fair Work SCHADS Award pay and allowances guidance
Still not sure?
The Fair Work tools are useful when you’re checking a straightforward pay rate.
But Award compliance can become more complicated when you have different classifications, rosters, sleepovers, travel, allowances or other arrangements interacting with each other.
If you’re unsure how the SCHADS Award applies to your employees or your payroll setup, you don’t have to work it out alone.
Talk to Kindred HR
Use the Fair Work tools to check the basics yourself. If you’re still unsure, reach out to Kindred HR.
We can talk through what’s happening in your business and work out whether Kindred HR can help.
More HR and payroll guidance
If you’re working through Award and payroll changes, you may also find this useful:
How to find the right modern award (and why it decides everything else)
Understanding which Award applies is the starting point for getting classifications and minimum entitlements right.
Not sure your SCHADS payroll is set up correctly?
Award compliance isn’t just about paying the right hourly rate.
It’s about whether your classifications, rosters, allowances, overtime, payroll settings and records all work together.
Kindred HR provides practical HR and payroll support for Australian small businesses, including payroll and Award reviews.
Payroll & HR Health Check
We’ll review your payroll setup, employee classifications, Award coverage and key HR processes and give you a clear picture of what needs attention.
You can use the Fair Work tools to check the basics yourself.
If you’re still unsure, or the setup is getting complicated, reach out to Kindred HR.
This article provides general information only and is not legal advice. SCHADS Award conditions can depend on an employee’s role, classification, employment arrangement and the circumstances of the business. Always check the current Award and Fair Work Ombudsman guidance before making changes to employee entitlements.
Last updated: 21 September 2026