Fair pay agreement in social care: a home care guide

Policy position checked against GOV.UK on 29 October 2026.

From April 2028, a fair pay agreement will set minimum pay and terms and conditions for most adult social care workers in England, including care workers employed by home care agencies. A new Adult Social Care Negotiating Body, made up of employers and trade unions, will negotiate it. Once Parliament ratifies it, its terms become part of your care workers' contracts.

The first negotiations start in April 2027, so the decisions that shape your 2028 pay bill will be made in 2027. That leaves time to understand your own pay costs, and to have a say through your provider association before the first rates are set.

‍

What is the fair pay agreement?

A fair pay agreement is a legally binding deal on minimum pay and terms for a whole sector, rather than for one employer. The Employment Rights Act 2025 gave the government the power to create a fair pay agreement for adult social care. On 16 July 2026 it published its response to the consultation, setting out how the process will work.

The agreement sets minimums. It can't reduce terms your staff already have, and you're free to pay more (GOV.UK factsheet). It applies in England only, and Scotland and Wales are setting up their own processes. The first agreement is expected to focus on pay and terms and conditions. Later rounds can also cover training, career progression and benefits.

‍

Who the fair pay agreement covers

It covers adult social care workers as defined in the Employment Rights Act 2025. Skills for Care describes this as anyone who spends most of their working time providing adult social care (Skills for Care). Care workers employed by independent home care agencies fall within that definition.

Three groups are outside the first agreement:

• workers employed directly by councils or the NHS, who already have national pay arrangements (the government will review this after three years)
• self-employed carers, who fall outside the legal definition of a social care worker
• unpaid carers

If you work with self-employed carers, the government has said it will look at self-employment in a later consultation on employment status.

‍

The Adult Social Care Negotiating Body

The negotiating body will sit at arm's length from ministers, with an independent chair due to be appointed in early 2027. Employers and workers have equal numbers of seats. The Care Provider Alliance coordinates the employer side. The worker side is a group convened by the Trades Union Congress (TUC), made up of UNISON, GMB, Unite and the Royal College of Nursing. Local government has non-voting seats.

Negotiations are expected to run once a year: six months from April to reach a deal, then six months to put it in place. If the two sides can't agree, the chair steps in first and can refer the dispute to Acas. If there's still no deal in time, the Secretary of State can set the terms so they start at the beginning of the financial year.

‍

The timeline

16 July 2026: government publishes its response to the consultation
By the end of 2026: negotiating body set up through regulations
Early 2027: independent chair appointed
April 2027: first negotiations begin
April 2028: first agreement takes effect, backed by £500 million for 2028 to 2029

‍

How it will be enforced

Once both sides agree, the deal goes to the Secretary of State, who checks it's affordable and deliverable, and then to Parliament to be ratified. After that, its terms become part of your care workers' contracts and are legally enforceable.

The Fair Work Agency, the government's new body for enforcing employment rights, will enforce the pay terms. The Department of Health and Social Care and the negotiating body will publish guidance for employers, working with the Department for Business and Trade, the Fair Work Agency and the Association of Directors of Adult Social Services.

‍

Who pays for it

The government has committed £500 million for 2028 to 2029. It goes to councils as part of the Local Government Finance Settlement and isn't ring-fenced, so each council decides how to spend it. The government also says it will work with the sector on commissioning and guidance for councils before 2028.

Care provider groups quoted by the government said the funding needs to match the plans (GOV.UK).

Because the money goes through councils, higher pay costs on privately funded care are likely to come through your prices. Our guide to calculating your homecare hourly rate can help you work out what you need to charge.

‍

What it could mean for home care

No pay rates have been agreed yet, but the consultation shows what people want on the table. Pay for travel time between visits was the most-chosen priority for terms and conditions, picked by 52% of respondents, and many raised unpaid travel time in domiciliary care. Guaranteed hours and zero-hours contracts came next, at 34%.

For home care agencies, that puts travel time at the centre. An agreed rate for time between visits would apply to every journey your care workers make between calls.

‍

What you can do now

1. Work out what you pay today. Pull gross pay for each care worker and split it into time on visits, travel time and mileage, so you can see what any agreed rate would cost you.
2. Check who's closest to the minimum. Look at how many care workers are paid at or just above the National Living Wage once travel time is counted. They're the people a new pay floor is most likely to affect.
3. Know your margin on each contract. Compare what each funder pays per hour with what that care costs you to deliver. If a contract is already thin, you'll want the evidence before fee talks with your council.
4. Read your contracts. Agreed terms will become part of care workers' contracts, so check what yours say now about pay, travel time, hours and holiday. Our guides to holiday entitlement and accrual and rolled-up holiday pay cover the current holiday rules.
5. Tell your provider association what you need. The Care Provider Alliance coordinates the employer side, so if you belong to a provider association, tell them what an agreement would mean for your agency before negotiations start in April 2027.
6. Talk to your commissioners early. Ask how they plan to use their share of the £500 million and how they'll set fee uplifts for 2028.

‍

Frequently asked questions

When does the fair pay agreement start?

The first agreement is due to take effect in April 2028. Negotiations begin in April 2027.

Does the fair pay agreement apply to home care agencies?

Yes. It covers adult social care workers in England employed by independent providers, which includes home care agencies. Staff employed directly by councils or the NHS are outside the first agreement.

Does it cover self-employed carers?

No. Self-employed carers fall outside the legal definition of a social care worker, so the agreement won't apply to them.

‍

Get your pay data ready with Birdie

When the first rates are agreed, you'll want to know quickly what they'll cost you. Birdie Finance gives you gross pay for every pay run, split into working time, travel time and mileage. It flags care workers at risk of falling below the National Living Wage and shows estimated gross margin for each care recipient after payroll and invoicing. With Upgraded Rostering, confirmed visits flow straight to finance, so your pay figures come from the care you actually delivered.

Want to see how it would work for your agency? Book a demo. It starts with a 20-minute call about how you run things today. There's no obligation to buy, no sales pitch and no commitment.

‍