SA’s Flinders University admitted to underpaying casual academics almost $1 million, while Australian universities owe $380 million in total. Adam Lucas and James Guthrie report.
The NSW Legislative Council’s final report into university governance, released last month, has delivered a number of damning verdicts on the sector. One important finding is that the business model currently favoured by NSW universities is not fit for purpose, and is causing harm to staff, students and communities.
Universities prefer to call it “underpayment”, but it is colloquially known as “wage theft”. In June 2024, the quantum of stolen wages amounted to at least $380m across 30 public universities.
The National Tertiary Education Union, which conducted the research, found that over 130,000 staff had not been receiving their full wage entitlements.
NSW Universities reported staff underpayments
| University | Estimated underpayment |
|---|---|
| UNSW | $70m |
| Western Sydney Uni | $29m |
| Wollongong Uni | $18m |
| Sydney Uni | $15m |
| UTS | $8m |
| Newcastle Uni | $6.3m |
Given the scale of wage theft at NSW universities over more than a decade, it was perhaps inevitable that it would be a focus for the NSW university governance inquiry. Finding 21 from its final report states:
“The recurring underpayment of staff across New South Wales universities reflects a systemic failure of governance, compliance oversight and organisational culture.”
However, despite claims by university spokespeople to the contrary, there is little evidence that their “underpayments” have been dealt with, and there have been wage-theft episodes extending over more than a decade.
Underpayment is illegal, but…
Although underpaying workers is now illegal in Australia (as of January 2025), it’s one thing to have a law in place and another to enforce it. The NSW inquiry committee noted:
“While the NTEU call for wage theft to be criminalised has been implemented nationally, with strong penalties including jail time for the worst offenders, no university executive has, to our knowledge, been publicly prosecuted for the underlying wage theft.”
While the new Australian laws include penalties of up to 10 years’ imprisonment, the committee was unequivocal that, “Until accountability extends to personal liability for individual executives and senior managers … these penalties will continue to be
regarded by those responsible as a cost of doing business.
Ignoring the advice
The Fair Work Ombudsman’s enforceable undertaking on UNSW required more than $32 million in rectification payments to over 33,000 staff. The university admitted underpaying entitlements under enterprise agreements between 2014 and 2023, and breaching record-keeping and pay slip requirements.
The Federal Circuit and Family Court decision revealed UNSW management seemed reluctant to rectify the situation:
“At the most basic level, all of the trouble UNSW finds itself in … arose out of UNSW’s failure to properly and adequately record the working hours of its casual employees over a number of years … Even after UNSW was aware of the issues with its record keeping … it did so without any sense of urgency.”
Critically, UNSW received detailed advice from Deloitte in June 2018 on how the problems occurred and should be rectified. The university advised Deloitte that all schools would implement a timesheet system from semester 2, 2018. This did not occur.
The NSW committee’s final report on the UNSW case was scathing:
“It is extraordinary that the university obtained very expensive advice as far back as 2018 as to causes and straightforward remedies, but management decided not to act on that advice. This was not only deeply disrespectful to staff; it allowed wage theft to grow.”
With regard to the $29m provisioned for historical underpayments at Western Sydney University, the committee noted this “raises serious questions regarding payroll governance, internal controls, compliance monitoring and executive accountability.”
Similarly, the Fair Work Ombudsman found that Charles Sturt University underpaid more than 2,500 casuals a total of around $3.2m between 2015 and 2022 due to a lack of institutional controls.
The human cost
The NSW committee found that casual academics – the majority of whom are women – “have been required to perform unpaid preparation time, marking time, and student consultation hours”.
This constitutes another category of unpaid work and another form of underpayment. The NTEU documented that two-thirds of university staff are employed on casual or fixed-term contracts, with casual workers at highest risk due to
power inequities and fear of reprisal, including the loss of work.
When workers complain, they face retaliation. The NSW inquiry heard consistent evidence that staff “can be reluctant to raise concerns … due to fears of adverse consequences” (Finding 8). At Southern Cross University, staff sought to give evidence in camera due to fears of reprisal.
A casual academic at UNSW Business School told the committee:
“When concerns were raised by the union, representatives were repeatedly told it was an individual issue rather than systemic problem … When staff are informed of how much they are owed they are not provided with the detail of how the amount was calculated, hence they are unable to check it. Staff who have left the university may not be aware they were underpaid.”
Consultants folly
The inquiry revealed a deeply troubling relationship between wage theft and universities’ reliance on external consultants. NSW universities spent $139m on consultants in 2025. Deloitte received $26.46m; KPMG took $19.71m; KordaMentha, McKinsey and EY together collected another $7.86m.
At UNSW, Deloitte was engaged in April 2020 to review wage remediation methodology. Yet the Fair Work Ombudsman’s court case noted that even after UNSW became aware of its record-keeping failures, “it did not implement [remedies] in any meaningful form” until litigation commenced. The presiding judge observed that UNSW proceeded “without any sense of urgency.”
The NSW committee also found that universities’ HR teams lack “specialist industrial relations or systems expertise”, resulting in reliance on
external consultants who themselves lack university sector knowledge.
The NSW Inquiry’s Recommendation 23 requires universities to “develop and maintain in-house expertise in the interpretation and application of industrial instruments … reduce reliance on external consultants and minimise the risk of underpayments.”
University governance flaws exposed. End of consultants’ bonanza?
The way forward
While the solutions are clear, they require political will that has so far been conspicuously absent.
The NSW inquiry recommended that university governing bodies “demonstrate effective oversight of wage compliance, workforce management and payroll assurance, including independent auditing and clear accountability for underpayments” (Recommendation 23).
But accountability must extend to personal liability for individual senior executives. Until it does, these penalties will remain a cost of doing business, a cost that’s ultimately paid from the same revenue pools that fund staff salaries.
As the NSW committee concluded:
Paying staff correctly and on time is among the most fundamental obligations of any employer
“… wage compliance should not be viewed solely as an operational or payroll matter. Rather, it is a governance issue requiring proactive oversight by governing bodies and senior executives.”
The question now is whether the NSW Government will act.
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Adam Lucas is an honorary senior fellow at the University of Wollongong and a founding member of Academics for Public Universities and Public Universities Australia. Prior to working at UOW, he was a researcher and policy analyst in the NSW Cabinet Office and the Departments of State and Regional Development, Aboriginal Affairs and Housing.
James Guthrie AM is Emeritus Professor in the Department of Accounting and Corporate Governance at Macquarie University. He is the joint founding editor of the Accounting, Auditing and Accountability Journal, which has been consistently ranked in the top five journals in his field.