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Wage Theft – Part 2: Don’t presume employers do the right thing

In our first Wage Theft article, we explained the concept of wage theft and provided examples to help members better understand it. We have extended our planned Wage Theft article series by one more to accommodate recent developments in this space.

While the next article in the series was foreshadowed to be about local examples of wage theft, we have adjusted this to include an article about the recently publicised ‘wage theft’ occurring at the Australian Catholic University (ACU).

Why? Because it provides such a contrast to the experience of the IEU and its members.

Recently, the ACU admitted it had underpaid staff to the tune of $3.6 million over a seven-year period.

What makes this worth reporting to you is the employer’s response to the issue; in some ways it is exemplary.

In the first instance, the underpayment was discovered and declared by the employer themselves. On that basis the employer (ACU) believes the underpayment should not be characterised as “wage theft” as there was no deliberate intent.

While that is honourable, it begs the questions: Why has such an issue occurred in the first place and gone unnoticed for so long (without detection) and who had responsibility for the payroll functions concerned?

In the second instance, we will focus on the response of the employer to the wage theft discovery.

Upon learning of the error, the employer notified all the relevant authorities: the Fair Work Ombudsman, the relevant Unions (National Tertiary Education Union and Public Sector Union), the Tertiary Education and Standards Agency, the Australian Tax Office and relevant Superannuation Fund (UniSuper).

On top of that, the employer accepted responsibility and issued a direct apology to staff with the University Vice Chancellor, Professor Skrbis, stating:

“You deserve to be paid correctly for your work and it is our responsibility to ensure you are being paid correctly.
On behalf of the university, I would like to sincerely and unequivocally apologise on behalf of the university and the Senate to every employee – past and present.
ACU is committed to wage integrity, in accordance not only with our legal obligations but also with our dedication to upholding the principles of Catholic Social Teaching.  Our mission as a Catholic university commits us to treat every human person with dignity and respect.”

Such a genuine apology should be accepted because not only does ACU unequivocally accept responsibility but also offers to compensate for the damage done and at a level not necessarily required of it in a legal sense. It exceeds that on the basis of invoking a moral obligation.

Apart from paying more than the statutory requirements that cap payments to 6 years, the employer will also:

  • repay the wages with interest, and,
  • repay superannuation contributions at the current rate of 11%. With an additional 10% on top of the identified superannuation owed paid in compensation for lost earnings on superannuation.

All of that suggests the employer is truly remorseful and acknowledges it should have done better and is willing to compensate staff as best it can.

Keep this in mind when, in our next article, we delve into the response of local employers to claims of ‘wage theft’.

If you suspect your wages and/or entitlements (including superannuation) may not be correctly paid, contact the IEU – 8410 0122 or