Australian Public Sector (APS): Division-wide bargaining to address pay fragmentation

The Australian Public Sector (APS) Statement of Common Conditions was published on 1 December 2023 with terms and conditions to now be negotiated at an agency level.

What is the APS Bargaining Agreement?

The APS bargaining agreement was initiated to address pay fragmentation across APS agencies with the objective of being more closely aligned at an industry level. This is a service wide bargaining which impacts employees and agencies who work in the Australian Public Sector.

This alignment will see an increase to the minimum standard benefits and entitlements on offer within these common conditions.

These changes will affect Federal Government organisations who align to the APS Bargaining Agreement and resulting common conditions, which will have impacts on pay and conditions for employees within both the community and public sector. Examples of the benefits and entitlements which will be increased include:

• Paid parental leave
• Leave entitlements
• Flexible working arrangements

It is now over to employees within these agencies to vote on their respective revised Enterprise Agreement before these conditions come into effect.

To move forward with this stage, the Australian Public Service Commission has released a Common Conditions statement which outlines the outcome and the resulting changes from this agency level bargaining.

How to implement APS Bargaining Changes

Our team of Australian payroll experts have created an APS Common Conditions Solution Guide (log in required) to assist our customers in aligning their people and payroll software to these changes.

Depending on each agency and bargaining agreement, some or all of the below conditions may apply. The configuration changes relating to the APS Bargaining Agreement can be divided into the following five categories:

Realignment payment

The realignment payment compensates employees for the earnings they would have accrued between their scheduled pay increase date, and the new common pay increase date of 14 March 2024.

One-off payment

Agencies that complete their Enterprise Agreement (EA) and receive a majority vote in favour of the agreement before the formally increased salary rates date (14 March 2024) are eligible for their employees to receive a one-time payment. This payment represents the additional earnings from a 4% pay increase within the time period of 21 December 2023 and 14 March 2024.

Salary uplift

As stated by the Commonwealth, the base salary structure at each APS classification from APS1 – EL2 has been updated to reduce the pay fragmentation across the service. As a result, a base minimum and maximum salary will apply to each classification.

For employees who had salaries below the new minimum, an additional pay rise will be provided to address this in addition to the APS-wide proposed pay offer. The base salary structure will lift salaries in 83 different agencies, impacting almost 8,000 employees over the life of the EAs, and will be rolled out accordingly:

• 35 agencies in 2024
• 63 agencies in 2025
• 83 agencies in 2026

Pay increase

All agencies who finalise and vote in favour of the new EA prior to 14 March 2024 will transition to providing employees with a consistent headline pay increase from the first full-pay period after 1 March each year. This annual pay increase will take place as follows:

• 0 per cent from March 2024
• 8 per cent from March 2025
• 4 per cent from March 2026

Common conditions

Common conditions of the EA come into effect when majority vote is received. There will be no reductions in employee conditions, instead employees keep any more favourable conditions from their current agreement.

Let’s chat!

If you need a payroll partner who supports you with the ongoing changes to your workforce, speak with our expert team. Our Aurion payroll specialists are available to discuss how we can streamline your payroll and provide additional support. You can reach our team by:

• calling 1300 287 466
• sending an email to [email protected]
• leave your details with us to reach out to you

We’re excited to partner with you to make life work better!