Lack of will puts paid to university workplace reforms

Students and staff at the University of Queensland. Picture: David Clark

Universities talk up their equity achievements but over the years some, many, maybe most, have badly treated some of their lowest earning employees. There is plenty of blame to go around.

According to the Fair Work Ombudsman, in the past four years it was “in contact” with 33 institutions in the university sector about potential staff underpayments. From July 2019 to December 31, 2024, the ombudsman recovered $176m owed to more than 80,000 higher employees.

La Trobe University is the latest in a list of institutions pinged by the FWO, in this case for underpaying 7600 staff $10.7m (including super and interest) across nearly seven years. According to the FWO, “the underpayments were caused by systemic failures in compliance, central oversight and governance processes”.

The ombudsman requires La Trobe to pay people what they are owed, sling the commonwealth a $220,000 “contrition payment” and fix its systems.

This case follows penalties for the University of Sydney, University of Melbourne, University of Technology Sydney, University of Newcastle and Charles Sturt University. The ombudsman also has won a Federal Court case against Melbourne University, which took “adverse action” against two casual academics who exercised their right to “make complaints or inquiries about their work”. There is also an imminent Federal Court penalty hearing in a case the ombudsman brought against the University of NSW.

The National Tertiary Education Union alleges underpayment is endemic in the university system and calls it “wage theft”.

There is a strong case for the comrades’ first claim – even before the FWO started scrutinising universities, payroll errors had long been turning up. Although universities appear to have sorted their superannuation systems, for a while there were regular reports from management announcing they had not paid super into people’s accounts. In 2017, the University of Wollongong reported it had stuffed up super for more than eight years and estimated it owed workers $10m.

Now management not paying staff the agreed rate for the job is the problem. But in almost all cases it is not deliberate theft, it is outright incompetence, caused by administrators not understanding payroll terms in their university’s enterprise agreement, negotiated with the unions on campus.

For support staff covered for out-of-hours work, what generally occurs is payroll forgets to add shift allowances. For casual academics, some young PhD students, some veterans teaching the same subjects on semester contracts for years, the problem is they are not paid the agreed rate for jobs. University managements unilaterally announce they should be able to mark X essays in an hour when it takes twice that. People with PhDs are supposed to be paid a premium and they aren’t.

Some arguments over underpayment go on for years and there are cases where staff would never have got their money without unions hammering away at the fortress gates of systems that should have been changed but were not.

In 2023 the ombudsman reported that UTS failing to update its systems in line with the new staff agreement meant nearly 3000 people were underpaid $4.4m. Somebody was owed $209,000!

The problem is that universities have long outgrown their systems. Their cultures are based on the ideal of self-governing communities of teachers and researchers but universities are enormous organisations with huge student populations supported by armies of administrators bigger than their teaching and research workforces. And while staff costs keep growing, universities have few ways to find efficiencies. There are PhDs that aren’t written on improving productivity in higher education basically because management indif­ference and union recalcitrance make it hard to happen. It’s just easier for everybody to announce that everything is the fault of inadequate government funding.

But when it comes to the way pay and conditions are set, the industrial relations system is a big part of the problem. Universities all have three-year enterprise agreements that take so long to negotiate, the new one is sometimes in force for just months when talks on its replacement are supposed to start.

The unions, generally the powerful and professional NTEU, are a big reason. Their leadership knows IR law backwards and never gives anything away in protecting and extending members pay and perks.

But managements are also wedded to the existing enterprise agreement system of pay rises in return for whatever concessions they can secure – even when they need to do more than tinker with a system that bakes in wage rises.

In 2022, the Australian Catholic University committed to a total 14.5 per cent pay increase through to this year and three weeks later announced 8 per cent of the workforce had to go. In December 2024 ANU asked staff to forgo a pay rise to save jobs – they voted no. The university has been trying and failing to increase income and cut costs enough to ensure long-term stability for a decade through reorganisations and people have had enough.

But while both sides stick with the existing system, negotiations will be confrontational, complex and confusing.

So complex that issues are lost in thickets of procedure. The Fair Work Commission once dealt with a dispute over accrued leave at Newcastle University where management and the union could not agree on what terms of the agreement they had negotiated actually meant.

So confusing that unions and university managements took three years arguing about the government’s law on converting fixed-term contracts into continuing jobs – this is a big deal for research projects funded for fixed terms. The problem was working out how it would apply to each university’s separate enterprise agreement. In the end the Fair Work Commission got involved, coming up with a solution that apparently had not occurred to all the insiders.

So confrontational that the present Sydney University agreement took two years to negotiate and at the end there was a split in the main campus union over accepting.

No surprise that nobody appears up for reforming the complex job classification system under the Higher Education Industrial Award. There are whole professions that just aren’t properly dealt with in a now-dated model. Like “third space workers” who design learning management systems. These are the people who are going to create teaching systems for the age of AI. Like the technocrats who run research supercomputers work understand how they can transform research.

The system needs to change but it probably will not. When Margaret Gardner moved from being vice-chancellor of Monash University to become Victoria’s Governor she proposed a “grand bargain” between unions and management to simplify the IR system. She left, nothing changed.

It won’t while both sides blame each other while agreeing that more public money is the only answer. It isn’t – however much government funding there is for operating costs will never be enough, not least because pay rises will soak up much of it.

And when savings must be made the people at the bottom of the academic tree cop it. That’s the casual lecturers who do not know if they will have a job from one semester to the next.

So why don’t the casuals complain when they aren’t paid the right rate? “The lack of certainty regarding future engagement, particularly for casual academic staff, leads to a culture within universities where employees rarely raise underpayment concerns or where a systematic claims review approach is not adopted,” the ombudsman suggests.

What a surprise.