Government unveils £500m Fair Pay Agreement for care workers

The Government has invested £500m in the first ever Fair Pay Agreement for adult care workers across England. 

The new deal will be negotiated by a body bringing together employers and trade unions to improve pay and conditions.

Secretary of State for Health and Social Care Wes Streeting, confirmed the Fair Pay Agreement is set up to address long-standing issues of low pay and lack of recognition in the care sector. 

The new body will be established in 2026 following a public consultation, and will negotiate pay and terms in 2027. 

The Agreement is expected to come into force in 2028 to help with recruitment and retention, and to support better recognition for care staff.

The £500m forms part of a £4bn increase in funding for adult social care in 2028-29 compared to 2025-26, announced in the Spending Review. 

A public consultation on the Fair Pay Agreement process has launched. 

The agreement will be backed by law through the Employment Rights Bill, which is progressing in Parliament.

Baroness Louise Casey is leading an independent commission into adult social care to build cross-party consensus and deliver recommendations for a National Care Service.

The adult social care negotiating body and a new Fair Work Agency will also focus on preventing exploitation in the sector, helping employers understand statutory duties and supporting enforcement.

After the consultation, the Government aims to introduce secondary legislation and set up the negotiating body in 2026, with negotiations planned for 2027 to prepare for implementation before 2028-29.