Universities ground zero for Aussie wage theft

The National Tertiary Education Union (NTEU) and four former staff members are taking action against Sydney-based private university JMC Academy in the Federal Court.

JMC Academy is being accused of underpaying staff and of serious contraventions of the Fair Work Act. All the four staff members were employed as independent contractors, which NTEU official Gabe Gooding compares to sham contracting.

Stephen Baker, who taught singing at JMC Academy for 18 years, is seeking unpaid superannuation for that period of time, as well as compensation for being paid well below the award rate.

More than three quarters of academic staff surveyed across Australia’s university sector were being underpaid, with “wage theft… rampant across Australian universities” according to the NTEU.

From The ABC:

All employees involved in the lawsuit were hired as independent contractors, an employment arrangement where employees are engaged as contractors and treated as an independent business.

NTEU National Assistant Secretary Gabe Gooding likened it to “sham contracting”.

“It’s where an employer disguises a genuine employment relationship as a relationship between two businesses, where one contracts the other for a service,” she said.

“We say sham contracting is the most egregious form of wage theft.”

The union alleges workers were left with no superannuation, no sickness insurance, workers compensation or leave.

“We do think it’s increasing [in the sector],” Ms Gooding said…

Following the ABC’s investigation, the NTEU carried out a survey of 2,174 professional and academic staff at every university except Charles Darwin University.

Of the academic staff, 78.4 per cent of respondents said they were not paid for all hours of marking outside of class time…

“The survey confirms what everybody’s known and long suspected — that wage theft is rampant across Australian universities,” NTEU President Dr Alison Barnes said.

“We’re looking at really high numbers of casual staff that are being exploited and this has a detrimental impact on both staff and students.”

Meanwhile, Australian vice-chancellors are the highest paid in the world:

Just another example of how Australia’s universities have shredded their social contract.

Leith van Onselen
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  1. Good. I think there’s going to be lots of this. Sadly, education may be negatively impacted, in the short term.

    Hopefully a few VCs and other luminaries take big pay cuts too.

  2. Thats exactly how 90% of government “consultants” are employed and they ALL know the superannuation, sick leave etc are all included in the hourly rate. They would have to prove they were not on a labour hire agreement and were in fact on an employment contract. Every one of these contracts I have signed in 27 years has been clear on the Superannuation etc.

    They accepted the contract, going to be hard to prove the contract was unfair…

    • Proper contractors get paid a decent chunk more than regular employees to compensate for their lack of super, sick pay, holiday pay etc, yes.

      Doesn’t sound like it in this case though. It says he was paid below award rate.

      Clear case of sham contracting.

      • They dont get paid more to compensate for a lack of anything, they get paid more as a result of those things being paid up front instead of “if” and “when” they take advantage of them… with a usually hefty premium on top.

    • Arthur Schopenhauer

      “They accepted the contract, going to be hard to prove the contract was unfair…”, unless you qualify as an Employee under the law. Given the teaching staff are delivering prescribed material, at prescribed times, with prescribed outcomes on the premises of the University, over multiple years, they are Employees.

      Most University contract staff work as ‘Servants’ (legal def: one who works for a master) of the University, and are Employees.


      • as I said “They would have to prove they were not on a labour hire agreement and were in fact on an employment contract.”

        Also, nothing in the article said anything about what pay rate they received or were entitled to under the award, we only have the claim by the NTEU…. its entirely possible they were not paid properly, and I would not be surprised based on what I have been told by a close friend at Western Sydney….

        • You are focused on form over substance.

          Australian courts focus on substance over form. Meaning is doesn’t matter what the contract says if the substance of the arrangement looked like employment then its employment.

          • Letter of the law is letter of the law, The only deviation is via new law or via precedents. Its how your lawyer argues it one way or another that can change the outcome.

            The example given that I was responding to as well as the details on the link still dont make it a clear they fall under the definition of Employee. If the contract has clauses in it about business expenses like insurance being part of the contractors responsibility then it falls into the realms of independant contractor and not employee.

            This is an interesting paragraph in that link.

            (5) Where a consideration of the indicia (in the context of the nature of the work performed and the terms of the contract) points one way or overwhelmingly one way so as to yield a clear result, the determination should be in accordance with that result. However, a consideration of the indicia is not a mechanical exercise of running through items on a check list to see whether they are present in, or absent from, a given situation. The object of the exercise is to paint a picture of the relationship from the accumulation of detail. The overall effect can only be appreciated by standing back from the detailed picture which has been painted, by viewing it from a distance and by making an informed, considered, qualitative appreciation of the whole. It is a matter of the overall effect of the detail, which is not necessarily the same as the sum total of the individual details. Not all details are of equal weight or importance in any given situation. The details may also vary in importance from one situation to another. The ultimate question remains as stated in (1) above. If, having approached the matter in that way, the relationship remains ambiguous, such that the ultimate question cannot be answered with satisfaction one way or the other, then the parties can remove that ambiguity a term that declares the relationship to have one character or the other

            This clearly says there is no one set of criteria that it can be determined, no check list and no single definition and indicates there is room for an argument to be made either way depending on the flavour.

            If the contract states things like “deliver X course” or outline specific tasks are delivered then it does not look like an employer/employee arrangement. I have not seen an employee contract that states exactly what duties an employee is expected to perform, more often they outline obligations to the employer and remuneration.

            All that said, I will repeat what I said originally…”They would have to prove they were not on a labour hire agreement “. Even if by all definitions they meet the feel of the “Employee” over “Contractor” definition, they still have to prove that. Should be easy, but I reckon it will still take days in court…

            They will have to prove its an employee relationship, its not on the University to prove its not. Its only on the University to defend the position.

  3. Lack of payment of superannuation is rampant in the cafe sector. I recall uni student friends working casual cafe jobs and they weren’t even aware they were entitled to any super. This was going back to the 2000s decade. And this is local born Aussies. If they piped up, they got super back paid, and then the shifts gradually and mysteriously dried up.

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