University of Newcastle and Charles Sturt University sign Enforceable Undertakings after underpayments

30 August 2022

The University of Newcastle (UON) and Charles Sturt University (CSU) are back-paying staff about $6.2 million and $3.2 million respectively, plus superannuation and interest, and have each signed an Enforceable Undertaking (EU) with the Fair Work Ombudsman.

UON has admitted that between 2014 and 2020, it underpaid 7,595 employees a total of $6,269,241 owed under its applicable Enterprise Agreements and the Fair Work Act 2009. Individual underpayments ranged from less than $1 up to $65,449. The EU requires UON to back-pay all known underpayments, plus a total of more than $171,000 in superannuation and over $1,375,000 interest, by 31 October 2022.

CSU has admitted it breached its relevant Enterprise Agreements when it underpaid 2,526 casuals a total of $3,237,390 between 2015 and 2022. Individual underpayments ranged from $2 up to $58,229. Its EU requires CSU to rectify all underpayments, plus more than $628,000 in interest on wages and about $476,000 in relation to superannuation and related interest, by February 2023.

Fair Work Ombudsman Sandra Parker said both universities had taken the initiative to self-report non-compliance, fully cooperated to provide assurance on their remediation methods and committed to full backpayments.

“Under these Enforceable Undertakings, in addition to making full back-payments, these public universities must implement stringent measures including systems improvements and training to ensure ongoing future compliance for the benefit of all their workers,” Ms Parker said.

“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. Both universities self-disclosed possible contraventions and then worked openly with the FWO on appropriate calculation and remediation methods.”

“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. We have previously announced investigations into 11 specific universities, commenced a Federal Court case against the University of Melbourne earlier this month, and we expect to be taking further enforcement action against other institutions.”

“The University of Newcastle and Charles Sturt University 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.”

The University of Newcastle (UON)

UON self-reported an initial underpayment to the FWO in 2020 after staff enquiries from casuals at its Conservatorium of Music revealed $64,600 in underpayments. It then self-initiated an audit of all employee entitlements under applicable Enterprise Agreements.

UON failed to pay correct overtime and penalty rates, underpaid meal allowances and failed to provide minimum engagement hours owed to casuals.

Underpaid UON employees performed work at all main campuses including Newcastle City, Callaghan, Ourimbah and Sydney and worked across various faculties, schools and business units.

The underpaid UON employees, including professionals, academics and teachers, were engaged mainly as casuals but some full-time and part-time staff were affected.

UON’s underpayments were the result of deficiencies in its payroll systems relating to interactions between overtime, allowances and penalty rates; and incorrect application of the clauses in the applicable Enterprise Agreements.

Charles Sturt University (CSU)

CSU self-reported its underpayments to the FWO in 2021 after it commissioned an external review of staff payments in response to widespread reports of underpayment in the higher education sector.

CSU’s breaches related to failures to provide minimum engagement hours for casual professional staff, and underpayment for teaching activities for casual academic staff, including for example failing to pay PhD qualified academics the higher qualified rate and failing to pay for required preparation time for lectures and tutorials.

The underpaid CSU casual employees performed work across all faculties, at all campuses, with the largest underpayments at the Wagga Wagga and Bathurst campuses. Its Computing and Mathematics School had the largest underpayments. The underpaid workers were engaged as academic, teaching or professional support staff.

CSU misapplied minimum engagement periods for casuals; lacked defined guidelines to ensure consistency in the application of minimum academic casual pay rates; and lacked system controls to identify timesheet entries inconsistent with the terms of its Enterprise Agreements.

Under their respective EUs, UON and CSU will provide the FWO with evidence of their system and training improvements to address the issues which led to the underpayments. They must also establish a complaints and review mechanism for underpaid employees.

The FWO’s investigation into the alleged underpayment of University of Melbourne casual academics is ongoing and is separate to the alleged coercion and adverse action that is the focus of its litigation. Some of the FWO’s other university sector investigations have been finalised with a formal caution, while most remain active.

Employers and employees can visit or call the Fair Work Infoline on 13 13 94 for free advice and assistance. An interpreter service is available on 13 14 50.

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