Nearly 600 staff at the National Emergency Management Agency are estimated to be owed $1.8 million after the agency uncovered systemic payroll breaches and referred itself to the Fair Work Ombudsman. On Wednesday, chief executive Pat Hetherington told Senate estimates that the latest figures were still preliminary, but confirmed the agency was also looking at whether some workers had been overpaid by at least $1.5 million.
Hetherington said resolving the payroll failures was one of his highest priorities, as the agency moved to work through what he described as a complex remediation process. He told senators the overpayment question would be handled on an individual basis and warned that the current numbers could change as the review continued. The agency has also awarded insolvency firm KordaMentha a $330,000 contract to help manage the fix.
The scale of the problem marks a sharp shift from what NEMA told a Senate estimates hearing in October last year, when officials said only one staff member was thought to have been affected by payroll issues. By December, that estimate had grown to as many as 120 shift workers. The latest review has now widened the picture again, with shift workers and surge staff emerging as the most affected groups.
NEMA self-reported non-compliance to the Fair Work Ombudsman on April 24 after KPMG was engaged to identify further underpayment issues. The agency said the errors were the result of systemic payroll breaches and deficiencies in processes such as recording shift work and time. Most of the overpayments were linked to failures to pay overtime, meal allowances and casual loading.
Hetherington told the hearing that staff had been spoken to directly about the problems, but said the agency did not yet have every answer. He said, “I do want to stress that this is preliminary data and I don't want that to cause concern amongst our workforce,” and added that the agency would work through the debts “in a very transparent way.” He also said, “We have been working very, very hard to get all the answers for them and to make this right.”
The latest figures suggest NEMA’s payroll issues are broader than first understood and will take time to unwind. The agency employs a large number of surge staff from other parts of government, which has made the records more difficult to reconcile. With KPMG still identifying further underpayments and KordaMentha now brought in to help with remediation, the immediate task is not just to calculate what is owed, but to decide who owes what, and whether any repayments can be recovered without adding to the damage already done to staff trust.
