Important changes to the SCHADS Award commencing from 1 June 2026

Earlier this week, the Fair Work Commission issued a decision that will introduce a range of changes to the Social, Community, Home Care and Disability Services Industry (SCHADS) Award. 

The changes primarily relate to how “sleepover” shifts are to be regulated and paid (in particular, sleepover shifts that involve active work both before and after the sleepover period). 

The key changes

1.  The Award will be varied to clarify that sleepover shifts involving work both before and after the sleepover must be treated as a single shift (i.e. the periods of work cannot be treated as two separate shifts). This reflects prevailing practices across the industry but may impact providers with less common arrangements.

2.  The Award will be varied to make clear that the 8-hour sleepover period cannot be treated as a rest break between shifts for the purposes of clause 25.4 of the Award.

3.  There will be greater flexibility in relation to the permitted duration of sleepover shifts. Specifically, sleepover shifts that include up to 12 ordinary hours of work (an increase from the current limit of 10 ordinary hours). This will allow for longer shifts before overtime applies. However, no more than 8 ordinary hours can be worked on either side of the sleepover.

By way of example, an employee may work a sleepover shift involving:

a) 8 hours’ work before the sleepover and 4 hours’ work after the sleepover; or

b) 6 hours’ work before the sleepover and 6 hours’ work after the sleepover,

before overtime entitlements are triggered.

4.  Each distinct portion of work on a sleepover shift will be treated separately for the purposes of calculating shift loadings. This means that work performed immediately prior to a sleepover will likely trigger an afternoon shift loading, while work performed immediately after a sleepover will likely not attract any shift loading. 

This differs from the current position, where many employers apply the night shift loading to work performed both before and after the sleepover. This change will result in some cost savings for some providers.

5.  Separately, the overtime rules for part-time and casual employees will be varied so that overtime is payable whenever an employee works more than 10 hours per shift or more than 10 hours per day (except where an extended sleepover shift, as described above, is worked – in which case overtime does not apply until more than 12 hours are worked). 

Currently, overtime is calculated on a per-day basis for part-time and casual staff. This change may therefore trigger additional overtime entitlements, depending on working patterns. While the change appears modest, it may create significant payroll complexity for some providers (and potentially increase costs).

Preparing for the changes

With the changes taking effect from the first full pay period on or after 1 June 2026, businesses have limited time to prepare. Affected businesses will likely need to:

• reconfigure pay rules in payroll systems (which might involve liaising with payroll vendors);
• adjust rostering and work allocation;
• consult with employees; and
• appropriate documentation to support implementation.