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Newcastle and Charles Sturt universities to pay back millions in wage theft

Both universities have been forced by the Fair Work Ombudsman to back pay staff more than $9 million in stolen wages.

The University of Newcastle (UoN) and Charles Sturt University (CSU) will back pay staff about $6.2 million and $3.2 million respectively, plus superannuation and interest, after auditors expose years of underpayment. Both universities have signed an Enforceable Undertaking (EU) with the Fair Work Ombudsman (FWO), forcing them to remediate underpayment across all of their campuses and facilities, and implement systems of improvement and training to ensure compliance with applicable Enterprise Agreements. 

CSU staff were notified of back pay earlier this month, after the findings of an independent audit by the University revealed wage theft dating back to 2015. Similarly, UoN self-initiated an audit of all employee entitlements under applicable Enterprise Agreements after self-reporting initial underpayment to the FWO in 2020. This occurred after staff enquiries from casuals at its Conservatorium of Music revealed $64,600 in underpayments.

CSU has admitted to underpaying 2,526 casuals a total of $3,237,390 between 2015 and 2022, with individual underpayments ranging from $2 up to $58,229. In accordance with its EU, CSU must rectify all underpayments, plus more than $628,000 in interest on wages and about $476,000 related to superannuation and related interest, by February 2023.

UoN admitted that it underpaid 7,595 employees a total of $6,269,241 between 2014 and 2020, with individual underpayments spanning from $1 up to $65,449. which is expected to be paid by 31 October 2022, along with more than $171,000 in superannuation and over $1,375,000 in interest. 

Most underpaid employees across UoN and CSU campuses, including teachers, academics, and professionals, were employed as casuals, though some full-time and part-time staff were affected. 

Between 2014 and 2020, Newcastle failed to pay correct overtime and penalty rates, underpaid meal allowances, and failed to provide minimum engagement hours owed to casuals. Likewise, CSU failed to provide minimum engagement hours for casual professional staff, and underpaid casual staff for teaching activities. This included failing to pay PhD-qualified academics their higher entitlement, and pay for preparation time for lectures and tutorials.

Fair Work Ombudsman Sarah Parker stated in a press release that the “University of Newcastle and Charles Sturt University have shown a clear commitment to acknowledging and fixing the various errors that existed in their systems and practices, and which they should have picked up”. 

“[These] breaches are examples of why all universities must invest in governance and processes to meet all their employment obligations, including their own enterprise agreements. Universities’ staff, the public and we as the regulator expect them to get it right.” 

A Senate committee set up in 2019 and released earlier this year found that 21 of Australia’s 40 public universities were implicated in the underpayment of both casual and full-time staff. 

Additionally, NSW’s 2021 Universities Audit revealed some $50.8 million in historical underpayments of staff wages and entitlements. In 2021, Universities collectively remediated $21.8 million to staff identified as having been underpaid.

Parker highlighted that “the universities sector is a new compliance and enforcement priority for the Fair Work Ombudsman, reflecting our concern about systemic underpayment issues we are finding.” This includes the FWO’s commencement of a Federal Court case against the University of Melbourne earlier this month.

Indeed, major wage theft revelations and remediation have unfolded at multiple Australian universities in the past two years, the effects of which have overwhelmingly been felt by casual employees.

In September last year, the University of Sydney admitted to wage theft of $12.75 million following a review of underpayments from 2014 to 2020, with over 12,000 current and former staff members to be repaid. This included individual repayments ranging from under $500 to over $5000.

Under their respective EUs, both universities will provide FWO with evidence of their system and training improvements to address these issues, as well as establish a new complaints and review mechanism for underpaid employees.