University of Sydney forced to back pay $23m to 14,000 staff

The University of Sydney will complete more than $23 million in payments to past and present staff after entering an enforceable undertaking with the Fair Work Ombudsman (FWO).

After underpaying a wide range of entitlements to staff, both past and present, the University of Sydney has entered an enforceable undertaking (EU) with the FWO, forcing it to make more than $23 million in payments, including super and interest, to more than 14,000 underpaid workers.

According to the FWO, the University of Sydney has acknowledged that it breached previous enterprise agreements, including:

• Base rates of pay.
• Minimum engagement periods for casuals.
• Payment for leave, including leave loading.
• Overtime, including meal allowance and TOIL entitlements.
• Shift penalties and loadings.
• Higher duties allowances.
• And marking and tutorial rates.

From these breaches, the University of Sydney has so far calculated a total of more than $19 million in underpaid ages, with an additional $3.2 million in interest and $950,000 in superannuation for a total of 14,727 current and former employees for work performed between January 2014 and June 2022. Thus far, the university has rectified a total of $20.49 million to these affected workers.

Individual underpayments that have been calculated to date range from $1 right through to $83,271. The majority of workers were underpaid around $1,300, excluding interest and superannuation.

Despite the university’s cooperation in rectifying these significant errors, the enforceable undertaking was necessary, according to Fair Work Ombudsman Anna Booth (pictured).

“The University of Sydney has acknowledged its governance failures and breaches and has responded by committing significant time and resources to put in place corrective measures that will ensure both full remediation of impacted staff and improved compliance for the future,” said Booth.

“The Fair Work Ombudsman will use EUs to oversee employers completing large-scale remediation reviews, where those employers are willing to be open with their approach, and we can ensure that it is robust and lawful.”

“Under the EU, in addition to rectifying the small remaining part of the confirmed underpayments to date, the university has committed to complete the ongoing Casual Academic Review and to rectify any further underpayments found. The university is also to commission, at its own cost, at least one independent audit to check it is meeting all employee entitlements.”

Following the EU, the University of Sydney must also make a $500,000 payment to the Commonwealth’s Consolidated Revenue Fund.

Booth believes that these commitments secured through the EU will help drive a cultural change throughout the wider university sector around compliance and boost worker voices within the University of Sydney.

“These measures will also enhance information sharing and consultation between University of Sydney employees and its governance bodies – boosting worker voice – to promote the finding and resolution of any future compliance issues within the workplace,” said Booth.

This, of course, isn’t an isolated incident to the University of Sydney. Earlier in the week, HR Leader reported that the University of Melbourne would also complete a total of $72 million in payments to more than 25,000 underpaid staff after entering an enforceable undertaking.

Booth described the compliance problems at the University of Melbourne as a “systemic issue”, highlighting the fact that the underpayments and the Victorian university carried on for many years.

“The University of Melbourne now accepts that it was unlawful that for many years, its casual academics adhered to ‘benchmarks’ which were inadequate and resulted in some employees not being paid for all hours worked,” said Booth.

“We’ve been very clear for several years that addressing the systemic issues in the university sector is one of our top priorities, and we look forward to working with the leadership teams at universities nationally to assist them to do the sustained, smart work required to ensure full compliance with workplace laws.”

Pertaining to the university sector as a whole, Booth proclaimed that it is one of the regulator’s key priorities to improve the compliance practices of these institutions, ensuring that their workplace obligations are abided by.

“Improving universities’ compliance with their workplace obligations is an ongoing priority for the Fair Work Ombudsman. We look forward to working with the leadership teams at universities nationally to assist them to do the sustained, smart work required to ensure full compliance with workplace laws,” Booth said.

The University of Sydney also acknowledged various record-keeping breaches, which involved a failure to both make and keep records in relation to rates of remuneration, hours worked, penalty rates, allowances, and overtime hours.

“Record keeping is the bedrock of compliance, and we expect all employers to make and keep all records the law requires,” said Booth.