A third of Australian sector ‘underpaying staff’, union warns

Some universities acknowledge ‘errors’ totalling millions of dollars but deny deliberate ‘wage theft’

October 27, 2020
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Australia’s workplace watchdog has revealed that it is investigating six universities over underpayment of their staff, double the number previously disclosed, as allegations of “wage theft” extend to one-third of the sector.

The Fair Work Ombudsman, Sandra Parker, has told a parliamentary committee that her office is scrutinising underpayment reports at four institutions – UNSW Sydney and the universities of Melbourne, Newcastle and Sydney – and has finalised investigations into the University of New England and James Cook University.

Of the six, all but Melbourne referred themselves to the ombudsman. Seven other institutions – Macquarie, Monash, Murdoch, RMIT, Queensland, Western Australia and the University of Technology Sydney (UTS) – are reportedly repaying money, auditing their payments or in dispute with casual staff.

Many of the revelations stem from an inquiry into unlawful underpayment by the Senate’s Economics References Committee. It was due to report last June but has been extended by a year owing to pandemic-related disruptions.

Addressing a public hearing of the inquiry in September, Ms Parker blamed many underpayments on payroll errors: “They do a bit of an audit and discover that it’s a lot bigger and goes back a lot longer than they thought. We’re not implying that it’s deliberate, but nevertheless it’s unacceptable.”

The National Tertiary Education Union (NTEU) says underpayment strategies are deliberate and include “semantic sleight of hand” – where managers reclassify tutorials as lower-paid “demonstrations”, “information sessions” or “small group teaching activities”.

Writing in The Conversation, NTEU assistant secretary Damien Cahill said the “most common and insidious” strategy involved requiring casuals to perform “key tasks” for no pay. Examples included class preparation and familiarisation with “labyrinthine” policies, he added. “[They] aren’t part of a casual worker’s contract yet are expected to be completed.”

The NTEU surveyed more than 2,000 casually employed members in August. It says 39 per cent of academic respondents reported having had tutorials reclassified and 78 per cent had not been paid for some marking. More than half said they were not paid for administration, and over two-fifths reported going unpaid for planning, curriculum development or school meetings.

Thirty-five per cent of professional staff said their universities ignored rules entitling them to at least three hours’ pay for short work sessions, while 31 per cent said they did not receive higher rates for weekend or holiday work.

NTEU president Alison Barnes said the union had recovered millions of dollars of lost wages and was preparing fresh legal campaigns against universities and private colleges. She said that insecure employment was the “root cause of wage theft” and that vice-chancellors should be summoned to the inquiry to “explain” their employment practices.

“Managers feel confident to squeeze employees, [who] are intimidated,” she said. “They think if they enforce their rights it’ll limit their career prospects.”

Australian Greens education spokeswoman Mehreen Faruqi, who has been referring universities to the inquiry, said new reports of underpayment were emerging regularly. “Mistakes, errors and delays can only explain so much,” she said.

In individual submissions to the inquiry, eight universities have challenged the NTEU’s claims. Their submissions highlight the complexity of university payroll arrangements and the “checks and balances” to ensure that the rules are followed, insisting that staff often receive benefits above award requirements and that universities work cooperatively with the union to resolve disagreements.

Monash said media reports had confused underpayments with “what is effectively a negotiating claim”. The University of Western Australia (UWA) invited the union to “re-examine our industrial relations frameworks with a view to simplifying and clarifying payment obligations without in any sense diminishing them”.

UWA, Monash, RMIT, UTS and Macquarie denied underpayments, although UTS, in a supplementary submission filed about a fortnight after its first, said an external review had identified about A$2 million (£1.1 million) in historical superannuation underpayments. Macquarie said it had agreed to pay staff an extra A$50,000 while a dispute with the union was resolved.

UNSW Sydney, Melbourne and Sydney said they had implemented comprehensive reviews or backpay processes after identifying problems in some faculties. Melbourne had already repaid staff in one faculty “and continues to work towards resolving the claims of employees from the other two”. Sydney committed to providing back payments with interest, but said the underpayments had affected a minority of staff and constituted less than 0.5 per cent of its A$1.4 billion payroll.

The Australian Higher Education Industrial Association denied “widespread” underpayment of casuals and said it was “fundamentally important to differentiate the concept of ‘wage theft’, which implies deliberate and systemic underpayment, from inadvertent underpayment of employees”.


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