These sites were specially set up (with origins dating back to the 1950s) to give disabled people the chance to participate in employment and further their workplace skills, while socialising in the process. Supported employees at the sites perform work such as basic manufacturing, sewing, wrapping, refurbishing, labelling and packing.
The provider has announced it will expand its community-based work program, focussing on smaller settings, such as cleaning, maintenance and gardening. It also plans to establish a new academy to help people with disabilities develop social skills, live independently and access therapy.
Some background
Supported employment is primarily delivered by Australian Disability Enterprises (ADEs) – organisations that provide employment opportunities to people with moderate to severe disability.
The majority of supported employees do not attract a typical full-time wage. Their wages are heavily subsidised and tied to the disability support pension.[2] A nationwide workforce of around 20,000 people with disability work in supported jobs.
What has triggered the closures?
The reported reasons are twofold.
First, funding is at the core. In the past, ADE’s received Australian Government block funding (ie, traditional grants, paid to providers, in order for them to deliver their programs). On 1 July 2020, the National Disability Insurance Agency introduced a new pricing framework for Supports in Employment, outlining how ADEs could claim from individual participants’ plans. (ADEs were allowed the discretion to move to the new pricing anywhere until 31 December 2021, but as of 1 January 2022 they are now required to claim using the new pricing framework.)
The new supported employment framework gives participants greater choice and control over the design and delivery of the support they receive – including where and how they work and who provides the supports. This in essence is the ‘consumer-directed’ nature of the NDIS. Supported employees on the NDIS can use their NDIS plan funding for on-the-job employment supports in any workplace they choose (not just ADEs).
Whilst beneficial for a participant’s choice, control and autonomy, the funding for supported employees can no longer be used by ADEs to help offset lower returns. Furthermore, changes to the Supported Wage System (SWS) are anticipated in 2022 when the Fair Work Commission completes its four yearly review of the Supported Employment Services Award. Those changes are expected to increase wages based on the principle of providing a suitable award safety net. Under these conditions, the viability of many large scale supported employment sites is impacted. It becomes difficult to compete with commercial companies who provide similar services, and don’t employ people with disability.
The second reason – which goes hand in hand with the evolution in Government funding policy – is that contemporary thought around disability services has changed greatly since the first large scale supported employment sites were opened decades ago. A modern approach to supported employment (and indeed disability services more generally) favours community-based work, and more targeted and personalised support, tailored to individual needs. Criticisms of large scale industrial work sites, and the benefits of more community-based support, has come through in evidence before the ongoing Royal Commission into Violence, Abuse, Neglect and Exploitation of People with Disability.
Who is affected?
It has been reported that about 90 staff and more than 700 supported employees may be affected by closures announced by the WA provider, with the peak body for non-government disability services working with a number of providers to identify new jobs and other alternatives for affected workers.
In a consumer-directed NDIS landscape, the shift away from block funding may mean that other disability services that are perceived as outdated and non-personalised (or at least don’t fit the consumer-directed funding model), could potentially meet a similar fate to the large-scale supported employment sites.
Comment
Consumer directed care is here to stay in NDIS. Whether and to what extent more traditional group style disability supports may continue to be offered will depend in no small part on the availability of funding.
The WA Minister for Disability Services has said:
‘We would like to have seen the Commonwealth Government to have allowed for a longer transition period … for the implementation of new funding models as part of the transition from Commonwealth Department of Social Services to the NDIS’.[3]
Perhaps more interesting and topical, however, are comments attributed to Bill Shorten – speaking then as Shadow minister for the NDIS and Government Services, but whose party has just formed government as a result of the federal election.
Those ‘solutions’ will be of great interest to the disability sector and the people it supports.
Meanwhile, when faced with uncertainty about future employment costs, future funding and a move towards individually tailored disability support provided in mainstream employment settings, it is easy to understand the need for strategic decision making like that reported last week.
For the persons affected by the closure of supported employment sites and their families, perhaps there may be some hope of limiting future job losses caused by uncertain employment costs if the new federal Labor government moves quickly on their pre-election undertaking to amend the Fair Work Act so that all future decisions made by the Fair Work Commission must consider the impact on job-security.
It remains to be seen whether a balanced solution can be achieved.
For further information or advice please contact Sean Foy or David McMullen
[1] https://www.activ.asn.au/what-we-do/news/looking-to-the-future-a-new-approach-for-activ/
[2] The majority of supported employees working in Australian Disability Enterprises (ADEs) are employed under the Supported Employment Services Award 2020 (the Award). Under the Award, supported employees can be paid a wage as calculated by a number of wage assessment tools. Source: https://www.dss.gov.au/disability-and-carers-programs-services-for-people-with-disability-supported-employment/supported-employment-frequently-asked-questions
[3] https://www.abc.net.au/news/2022-05-17/activ-disability-worksites-close-following-ndis-funding-changes/101071900
