Business · Bank wage underpayment
NAB found its payroll problem in 2019 and kept underpaying staff until 2026
National Australia Bank underpaid about 66,000 current and former staff A$127 million in wages over 14 years. With interest and superannuation the bill is about A$169 million. The bank settled with the Fair Work Ombudsman, so it will not face a court or a court penalty.
Written 6 min read · 16 sources
The underpayments at National Australia Bank started around 2012. By the time the bank and its regulator made them public on Thursday 12 November 2026, Australian time, they had run for about 14 years. In that time NAB found the problem, reported itself to the Fair Work Ombudsman, was found by a later review not to have fixed it, and warned the market about a bill that has since grown. The settlement makes the story public. What happened before it is the bigger part of the story.12
NAB told the Australian Securities Exchange that it had entered an enforceable undertaking with the Ombudsman over breaches of the Fair Work Act 2009. The breaches cover parts of the National Employment Standards and four successive NAB enterprise agreements, from 2011, 2014, 2016 and 2024. The Ombudsman's figures, as reported by Australian outlets, put the shortfall at A$127 million in wages. It is spread across 65,999 current and former employees, which most coverage rounds to 66,000.245
Fourteen years of payroll failure
- About 201213
The underpayments begin. They will eventually reach staff in every state and territory.
- 20191
NAB becomes aware of the problem and reports itself to the Fair Work Ombudsman.
- 20241
A review finds NAB has not properly dealt with the problem, so staff are still being underpaid.
- Aug 202579
NAB warns investors of about A$130 million in payroll review and remediation costs for the 2025 financial year. The payroll problems are described as widening.
- Thu 12 Nov 202621
NAB tells the ASX about the enforceable undertaking, and the Ombudsman issues its statement.
What the bill adds up to
The A$127 million in wages is only part of the bill. AAP reports about A$34 million in interest and about A$8 million in superannuation, Australia's compulsory retirement contribution. That brings the total to about A$169 million, which the Australian Financial Review rounds to A$170 million. The Ombudsman says NAB has already repaid about A$155 million to current and former staff, which leaves roughly A$14 million still to be paid out.5316
Divided evenly, the wage shortfall comes to a little under A$2,000 a person. That figure hides the worst cases. Nine reports that some staff were underpaid by up to A$87,000. The Age puts it at more than A$87,000 each for some workers. Neither outlet gives one exact largest figure, so the size of the worst single case is still not settled. Either way, the worst cases are dozens of times the average, and for many bank employees more than a year's pay.112
How a bank fails to pay its own staff
The Ombudsman called these "basic failings" in paying the correct minimum wage, penalty rates and leave entitlements. It gave the causes as "deficiencies in governance processes and compliance oversights, inadequate record-keeping, legacy payroll technology, and limited investment in specialist capability relevant to payroll operations."1
In practice, NAB did not record the hours its staff actually worked, so its pay runs had no reliable count of hours behind them. It calculated leave balances wrongly. It did not check that pay kept up with each new enterprise agreement, so wages fell behind what the bank had agreed to pay. The AFR also reports that NAB's payroll teams were under-resourced. These agreements were negotiated with the bank's own workforce and signed by the bank, and its payroll still did not apply them.631
None of these failures is subtle. Recording hours, working out leave and updating pay rates when an agreement changes are the core jobs of any payroll system. The Ombudsman's list describes years of underinvestment more than one technical fault.
We take our payroll obligations extremely seriously as a basic element in employing people. We sincerely apologise for these unintended errors.
White added that NAB has paid, and will keep paying, anyone affected. The bank says it is "investing in improving employee systems, processes and support including a new human resources information system and payroll platform." NAB calls the errors "unintended," and nothing published suggests otherwise. But the problem continued after the bank knew about it. The Age says the problems went on for seven years after NAB first reported them. That is the part an apology for errors does not explain.112
Why there is no court case
An enforceable undertaking is a negotiated agreement. An employer that signs one avoids court proceedings and court-imposed penalties, and in return it repays workers and commits to compliance measures. NAB will also pay A$2 million into the Commonwealth Consolidated Revenue Fund, the federal government's general account. The AFR describes the payment as a record. NAB has committed to measures meant to keep it within workplace law in future. The detailed list was not in the material we reviewed.143
Even so, the result is clear. A$2 million is about 1.6 percent of the wages NAB failed to pay. A bank that underpaid tens of thousands of people for 14 years, and kept doing so after it reported the problem, will face no court finding and no penalty beyond that payment. Booth's reasons are cooperation and repayment. Whether those should outweigh five years without a proper fix after the self-report is a judgment, and the regulator has made it in the bank's favour.
The market showed little concern. NAB shares closed at A$38.56 on 11 November and were last quoted at A$38.77, up about half a percent, according to WSJ Markets data. Over the previous month they traded between about A$38.50 and A$41.50.
The number that kept growing
In August 2025 NAB told the ASX it expected about A$130 million in payroll review and remediation costs for that financial year. HR Leader and Investor Daily reported that this would push operating expenses up 4.5 percent on the year before, and the ABC reported the payroll problems as widening at the time. The final figure is A$169 million including interest and super. None of the published material explains how the first estimate became the second, and none of it separates the two figures in a way that would allow a direct comparison.79115
Known
Unknown
- When the remaining roughly A$14 million will be paid, and how hard-to-find former employees will be reached. No deadline has been announced.
- How the A$130 million estimate from August 2025 grew to A$169 million.
- The exact size of the largest single underpayment: "up to" or "more than" A$87,000.
Next
- Whether the full undertaking, including NAB's compliance commitments, is published on the Ombudsman's register of enforceable undertakings.
- Whether the last of the back pay reaches the people it is owed to.
Sources16
3 older pieces read for background.7 outlets with no date:
Every source, by outlet
16 sources from 16 outlets· Most cited first
AAP Newsaap.com.au1
- First reported
- NAB hit with $169m bill for underpaying 66,000 staff
ABC listenabc.net.au1
Australian Financial Reviewafr.com1
fairwork.gov.au1
Google News Australia (AU:en)nine.com.au1
hrleader.com.au1
- First reported
- Payroll issues to cost NAB $130m in operating expenses
Human Resources Directorhcamag.com1
- First reported
- NAB signs undertaking over $127m underpayments
Investor Dailyinvestordaily.com.au1
Lawyerlylawyerly.com.au1
- First reported
- NAB to backpay $127M to underpaid staff
Legal 500legal500.comFirst1
- First reported
- PAY BACK – employer undertakes to reimburse ...
Mirage Newsmiragenews.com1
As aired
- One of Australia's biggest banks shorted sixty-six thousand of its own workers for fourteen years.
- National Australia Bank now owes them about 169 million dollars with interest and super. And it's settling with the workplace regulator instead of facing a court.
- What still needs answering is how the underpayments kept going for years after the bank reported itself.
- NAB admitted the underpayments on Thursday, Australian time. Full-time, part-time and casual staff in banking and management jobs were hit in every state and territory. They lost ordinary wages, penalty rates, overtime, termination pay, leave and superannuation.
- The unpaid wages come to 127 million dollars, spread across 65,999 current and former employees. That averages a little under two thousand dollars each. But some workers were shorted about 87,000 dollars, more than a year's pay for many bank employees.
- Interest and retirement savings push the bill well past that.
- On top of the 127 million in wages, NAB owes about 34 million in interest and about 8 million in super, Australia's compulsory retirement saving. That's about 169 million. The bank has already paid back about 155 million, so roughly 14 million is still to go.
- The failures started with the basics. NAB didn't record the hours its staff actually worked, so the pay it sent out had no reliable count behind it.
- It also calculated leave balances wrongly. And it never checked that pay kept up with each new enterprise agreement, so wages slid behind what the bank had promised. NAB negotiated and signed those agreements with its workers in 2011, 2014, 2016 and 2024.
- The Ombudsman called these basic failings in paying minimum wages, penalty rates and leave. It blamed weak governance, poor record-keeping, old payroll technology and too little investment in payroll expertise. That list points to years of underinvestment in the bank's own pay system.
- We'll keep following this as the last of the back pay goes out to NAB's workers. Subscribe to this channel, and find more at heyday dot news.
- NAB knew about the problem in 2019, and its staff kept getting underpaid anyway.
- The underpayments began around 2012. In 2019, NAB found the problem and reported itself to the Ombudsman. But a review in 2024 found the bank hadn't properly fixed it. In August 2025, NAB warned investors of about 130 million dollars in payroll costs. Now the bill is 169 million.
- That August warning came with a four and a half percent jump in operating costs, and the payroll problems were described as widening. Nobody has explained how that estimate grew into 169 million.
- NAB won't face a judge over any of this.
- Fair Work Ombudsman Anna Booth accepted an enforceable undertaking, a negotiated deal that spares an employer court and court penalties if it repays workers and commits to compliance. Booth said it was appropriate because NAB cooperated with the investigation and moved to fix the underpayments.
- NAB will also pay two million dollars into the federal government's general account as a contrition payment. That's about 1.6 percent of the wages it failed to pay. Beyond that, a bank that underpaid tens of thousands of people for 14 years faces no court finding and no penalty.
- The bank has also committed to measures meant to keep it within workplace law from here on.
- NAB's people and culture chief, Sarah White, apologised. She said the bank takes its payroll obligations extremely seriously, called the mistakes unintended errors, and said NAB has paid back, and will keep paying back, anyone affected.
- The bank says it's investing in a new human resources system and a new payroll platform.
- Investors barely moved. NAB shares closed at 38 dollars 56 the day before the admission, and were last quoted at 38.77, up about half a percent. Over the past month they've traded between roughly 38.50 and 41.50.
- About 14 million dollars still hasn't reached the people it's owed to, and some of them are former employees who may be hard to find.
- No deadline has been announced for the rest of that back pay.
- The bank reported itself in 2019, then kept running a payroll that didn't record hours or keep up with its own pay deals, and a review five years later found the problems still unfixed. The underpayments ran into this year.
