An employer found to be non-compliant with their employment obligations runs the risk of Court imposed civil penalties for non-compliance.
Those penalties can be against both the company, and a Director / other person responsible for the non-compliance, and collectively, can be substantial.
An enforceable undertaking is a legally binding agreement between the Fair Work Ombudsman (FWO) and an employer who has breached workplace laws. It exists as an alternative to civil litigation, where an employer acknowledges it has done the wrong thing by breaching workplace laws, and wants to correct underpayments.
A written document, it is usually comprised of:
- An acknowledgment of the non-compliance that has occurred,
- The employer’s commitment to rectify the underpayments,
- Details of interest and superannuation (plus interest on the superannuation) and payment schedules;
- (often) A contrition payment to be made by the employer; and
- Activities that the employer will engage in as future compliance actions to ensure non-compliance does not reoccur.
All enforceable undertakings are published on the FWO website, making them readily available to other interested parties, including current and potential employees.
Recovery Amounts
In 2014-2015, the FWO accepted 42 enforceable undertakings which saw it recovering a total of $3.7 million in underpayments. If that seems high for 2015, it pales in comparison to current figures. In the past year, the FWO has secured:
2025 Enforceable undertakings
| Institution | Amount in Underpayment | Contrition Payment |
| University of Tasmania | $21,400,000 | $175,000 |
| Monash University | $20,700,000 | $350,000 |
| Queensland University of Technology | $1,900,000 | $250,000 |
| Westpac Banking Corporation | $50,000,000 | $800,000 |
| University of Wollongong | $6,600,000 | $130,000 |
| La Trobe University | $10,770,000 | $220,000 |
| Relationships Australia | $5,600,000 | – |
| Hamilton Island | $28,100,000 | $750,000 |
| Griffith University | $8,340,000 | $175,000 |
| Total | $153,410,000 | $2,850,000 |
The amounts above represent enforceable undertakings secured in 2025 alone. This represents an increase nearly 50 times over as compared to 2015!
It is striking that it is not only small to medium enterprises who find themselves underpayment rectifications, but rather we see large companies and prominent universities struggling to keep on top of wage compliance. One of the reasons why many universities feature on the list of enforceable undertakings is that the FWO has been focusing on universities’ compliance with workplace laws – it has been one of the FWO’s priority industries for the 25/26 period.
Importantly for businesses, the cost of non-compliance is not limited to the actual underpayments. Employers are typically required to make a (not insignificant) contrition payment to the Commonwealth Consolidated Revenue Fund, as demonstrated in Table 1. Beyond the monetary cost, there is the reputational cost and damage to goodwill. Employers looking to build a reputation as an employer of choice should be very wary of the damage that can be caused by non-compliance.
While the focus for the FWO in recent years has been on universities’ compliance, the FWO regularly engages in campaigns across different sectors. If the success of the 2025 enforceable undertakings is any indication, we may see an increase in compliance related campaigns by the FWO.
This means that, more than ever, it is imperative for businesses to ensure that they are compliant with workplace laws. Preventing breaches of workplace laws remains the single most effective strategy to avoid financial and reputational penalties.
Priority Industries and Sectors for 2025/2026
In addition to universities, the other industries and sectors FWO compliance activities have focused on include:
- Aged care services
- Agriculture
- Building and construction
- Disabilities support services
- Fast food, restaurants and cafes
- Large corporates
Strengthening Your Compliance Framework
The scale of recent enforceable undertakings highlights a clear message: wage compliance is not just an administrative task, it is a significant financial and reputational risk area. The amounts being recovered demonstrate that even large, well-resourced organisations can fall short.
Prevention is always better than cure. Proactive payroll reviews, supply chain audits, and clear internal compliance systems can significantly reduce the risk of underpayments and regulatory intervention.
At IRiQ Law, we assist businesses with payroll auditing, award interpretation, compliance reviews, and supply chain risk management. If you are unsure whether your organisation is meeting its obligations, now is the time to act.
Contact our team to discuss a confidential compliance review and protect your business before issues escalate.
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