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Department of Social Services amends wage subsidy clause

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5/07/2018

The Department of Social Services (DSS) recently wrote to Disability Employment Services (DES) advising of changes to the DES Agreement to take effect as of 1 July 2018. A new clause 95.4 was to be included in the agreement that placed very restrictive requirements on how providers could offer a DES Wage Subsidy or Restart payment to employers. The proposed change restricted providers from supplementing Wage Subsidies or Restart payments and placed DES providers at a disadvantage compared to JobActive providers, who have access to more generous subsidies. Many DES providers were concerned that this would impede their capacity to entice employers to offer jobs to people who are furthest removed from employment. DSS indicated that the change was intended to discourage the practice of a provider ‘purchasing’ a job, through payment of a Wage Subsidy equivalent to 100 per cent of the wage. These jobs were often not sustainable and resulted in the employee ceasing work after the subsidy expired at 26 weeks.A recent discussion between DSS and provider peaks resulted in the new clause 95.4 being amended to reflect the following:

NDS acknowledges that the changes above address the shared concerns of DES providers and DSS. Concerns about a prohibition on supplementing government wage subsidies have been alleviated and sustainable long term employment outcomes that are not reliant on artificial time limited incentives are now more likely to be achieved.

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