Westpac cops $8m underpayment bill

Westpac has advised it will be remediating current and former employees who were not paid their correct long service leave entitlements due to calculation errors.

The errors were said to lead to both underpayment and overpayment of some entitlements and were found in a review of the bank’s payroll and long service leave arrangements.

Westpac stated it will not ask staff who were overpaid to repay any money. The staff who were underpaid are to receive the missed payments plus interest.

Westpac has admitted the error following big four rival NAB declaring it would be undertaking a remediation review in mid-June, after it found a payroll issue that resulted in staff being underpaid.

At the time, NAB was finalising payments to around 1,500 staff totalling $1.3 million.

Alastair Welsh, group executive, enterprise services at Westpac, said the group apologises to affected staff and its priority is to make the payments as soon as possible.

“For long service leave entitlements, different rules apply to different employees based on their employment history and work arrangements,” Mr Welsh said.

“Regrettably, our system didn’t correctly capture the right methodology every time.

“We are putting in place measures to ensure employee long service leave is correctly calculated.”

In some instances, the wrong rules were said to be inadvertently applied in the payroll system, affecting people’s long service leave entitlements.

The error could mean a change in hours worked for employees over a period of time was not recognised.

“We are committed to putting things right for our people and preventing the issue from re-occurring, and we will continue to check our processes to ensure employees receive their correct entitlements,” Mr Welsh said.