The University of Wollongong has admitted to a $10 million underpayment bungle, after discovering late last year that it had been incorrectly paying superannuation for thousands of current and former employees.
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On Wednesday, the institution – one of the Illawarra’s biggest employers – revealed to staff that there have been “longstanding anomalies” in its payroll system.
The massive error – which has been ongoing since July 2009 – is expected to affect about 30 per cent of the 21,406 people who have worked there in the past eight years.
Chief finance officer Damien Israel said the problem came to light in November, when staff brought it to the attention of management.
“The flag was raised late last year, and we employed Deloitte to come in and do a very detailed review,” he said.
He said consultants looked at 767,757 payslips, paying 21,406 employees more than $1.95 billion, including $229.82 million in superannuation contributions over the eight year period.
“They found that, in about 30 per cent of employees paid over that period, there was some form of anomaly in the superannuation payments made on behalf of staff,” Mr Israel said.
He said UOW had held off telling staff about the possibility they had been over or underpaid for several months, so they could “get to the bottom of the very complex problem”.
“This is not one single error, and there are many potential issues that have contributed to this,” he said.
“It has been occurring over a substantial period of time and the issues have built up, and in some cases, errors have compounded on errors. We’ve still got work to do and we’re trying to resolve it by the end of this financial year.”
Mr Israel said he could not yet quantify how individuals would be affected, but said there was “a broad cross-section of staff” who would likely be missing “lots of small amounts” of super.
On Wednesday morning, Vice Chancellor Professor Paul Wellings apologised to all current staff via an email.
“I apologise for these errors and any inconvenience caused to those staff affected,” he said.
“I value each of you and your contribution to the University and I am determined to see that you, and your former colleagues, all have the correct superannuation contributions made on your behalf.”
“As this issue does not affect all UOW employees, we will be contacting each affected current employee individually and are making arrangements to make contact with affected former employees.”
“We will be doing this in the coming weeks and hope to have this completed as soon as possible.”
The university outlined its commitment to “fully remediate” the error “without impacting job security, or previously announced projects, or the University’s normal teaching and research activities”.
It has estimated its costs at $10 million.
The University will also have to pay interest to the Australian Taxation Office (ATO) to compensate affected staff, and has included a provision for possible penalties for the late contribution of super.
Additionally, the university will not seek recovery of overpaid super contributions.
The fee for Deloitte to investigate the complex web of incorrect payment is not included in the $10 million bill.
However, Mr Israel said the consultants work was ongoing and he could not disclosed how much the review of the university’s super payments would cost.
Once affected staff have been told how their superannuation contributions have been over or underpaid, the institution will issue an update.
It has also set up a publicly webpage at http://uow.edu.au/about/scrp and a UOW Superannuation Assistance Line on 1800 501 895.
Mistake ‘a wake up call’: unions
The Illawarra’s union boss says the University of Wollongong’s revelation that it has been incorrectly paying superannuation contributions over the past eight year should serve as a “wake up call” to all businesses.
While he acknowledge that the university’s $10 million bungle appeared to be a mistake, South Coast Labour Council secretary Arthur Rorris – who has been working to expose widespread underpayments in the Illawarra hospitality industry – said it showed the need for more vigilance from all employers.
“This is obviously an administrative failure, but it underscores the importance of organisations big and small to check and consult with their employees, and the unions who represent them, to ensure these mistakes do not happen,” he said.
On campus, UOW branch president and History professor Georgine Clarson said staff were finding the university’s error “hard to understand”.
“It’s early days, so as a union we haven’t yet had a chance to discuss it,” she said. “We were dismayed to hear it, but we’re waiting to see how the university will make this right. and we’re interested to see how it unfolds.”
Kate McIlwain
For more than a decade, I've helped the Illawarra Mercury set the news agenda across the region. Currently I'm the paper's health reporter - covering the stories of Illawarra workers and residents in the wake of a global pandemic and at a time where our health systems are stretched to the limit.
For more than a decade, I've helped the Illawarra Mercury set the news agenda across the region. Currently I'm the paper's health reporter - covering the stories of Illawarra workers and residents in the wake of a global pandemic and at a time where our health systems are stretched to the limit.
