CSIRO has confessed to the systematic underpayment of leave entitlements of more than one hundred former casual employees over a seven-year period, to the tune of nearly $300,000.
The admission means CSIRO joins a list of high-profile employers who have been caught out underpaying causal staff including the Australian Broadcasting Corporation (ABC), the University of New South Wales (UNSW) and the Australian National University (ANU).
From 1 January 2025, changes to the Fair Work Act, due to the implementation of the Closing Loopholes amendment legislation, means that intentional underpayment of wages or entitlements – rather than honest mistakes – can attract tougher penalties.
CSIRO Chief People Officer Marcia Gough recently wrote to the Fair Work Ombudsman (FWO) and copped to the offence, describing the misdeed as a “payroll administration error that has resulted in the non-payment of long service leave (LSL) entitlements to some former casual employees upon cessation of their employment.”
“A casual employee is entitled to the pro-rata payment of their accrued LSL entitlement on termination of employment if they are aged 55 years or over and have at least one year of service.”
“(Our) review has identified a subset of 110 casual employees who CSIRO considers met the relevant criteria but were not paid out their pro-rata long service leave entitlement upon the end of their employment between 2008 and 2025,” Ms Gough said.
Of the 110 casual employees identified as underpaid, the entitlement owed to individuals ranges from $39.49 at one end up to a maximum of $13,248 at the other, exclusive of interest.
“The total amount payable to former staff is estimated to be approximately $287,119, subject to final interest calculations, for the period 2008 through to 2025.”
Ms Gough claimed the errors occurred “due to an inconsistent application of the manual employee cessation process required at CSIRO” but stopped short of offering an apology for the offence.
Excuses aside, the guilty plea means CSIRO joins several big-name employers that have recently appeared in the dock for underpayment of casual employees. In June 2020, the ABC entered an enforceable undertaking with the FWO to back-pay over $11.9 million in unpaid entitlements to more than 1,800 current and former casual employees.
UNSW continues to investigate underpayment to current and former casual academic employees, after self-reporting to the FWO in 2020. The workplace investigator later took the university to court, alleging breach of laws relating to record-keeping, pay slips and frequency of wage payments.
Last year ANU admitted underpayment of 2,290 current and former causal employees over eleven years to the tune of nearly $2 million, with the median impact of $600 per staff member.
While changes to the Fair Work Act now mean that intentional underpayment of wages or entitlements can be a criminal offence, the FWO stresses that this doesn’t include honest mistakes.
According to the Australian Council of Trade Unions, “employers can face jail time or fines of up to $7.85 million under new laws criminalising wage theft that (have) come into operation… after a long union campaign.”
However, the FWO advises that the new criminal offence provisions do not apply for payments for taking long service leave.
Ms Gough says that CSIRO has calculated the underpayment owed to each former staff member and will apply simple interest to the amount owed to an employee at a rate of 7 per cent.
“CSIRO will commence contacting affected employees using all available contact details held by CSIRO from the week commencing 28 July 2025. CSIRO will make all reasonable efforts to communicate with the affected individuals to inform them of the outstanding payment, confirm bank account details, and ensure the identity of the person receiving the payment.”
“Payment of the outstanding monies will be made as soon as is reasonably practicable after confirming these details,” Ms Gough said.
CSIRO claims to have introduced a “robust process” to ensure the mistake does not occur again.
This includes a new requirement for the payroll team as part of a mandatory process (following each pay period) to identify casual staff that have ceased employment and a review of their circumstances to confirm if the payment of LSL is required.
Whether or not CSIRO’s admission of error and undertaking to repay the underpaid entitlements and repair payroll processes will satisfy the FWO remains to be seen.
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