While the looming teacher shortage in Australia’s schools has been well publicised, a less visible – but potentially more damaging – crisis is bubbling away under the surface.
According to an education workforce expert many schools could be walking a legal and financial tightrope due to issues like incorrect staff payments, misclassifying roles, and failing to keep up with changes to labour laws.
From January 1, 2025, underpaying staff in Australia won’t just attract fines — it could lead to criminal charges, with school leaders personally liable. This comes at a time when 70% of schools are struggling to find casual teachers, forcing them to rely on an increasingly complex network of relief staff.
According to the Fair Work Ombudsman, education is now among the top sectors for wage underpayment claims. With principals spending up to a fifth of their week managing absences, experts warn that mounting compliance risks — from pay errors to missed background checks — are slipping through the cracks.
Alistair Elliott, Managing Partner at Discovery Consulting, warns these governance gaps could leave schools open to hefty penalties – and in some cases, personal liability for leaders.
Below, The Educator speaks to Elliott, about the hidden compliance risks facing schools, how poor payroll practices could land principals in hot water, and what school leaders can do now to protect their staff – and themselves.
TE: New regulations mean that as of from January 2025, underpaying staff could land school leaders in serious legal trouble. What are some of the most common payroll mistakes you’re seeing in schools right now – and how can principals spot and fix these before they’re caught out?
We see three recurring payroll issues in schools: incorrect staff classification, miscalculated entitlements like leave loading and higher duties, and failure to manage multiple assignments across contracts correctly. These errors often stem from outdated systems and the sheer complexity of award and EA interpretations.
With new legislation from January 2025 introducing criminal penalties for directors, the stakes are significantly higher. Principals can get ahead of these risks by ensuring their systems are capable of interpreting EAs and awards accurately, tracking all hours worked, and flagging inconsistencies. Regular audits, paired with integrated workforce management solutions, can transform compliance from a manual burden into a built-in safeguard.
TE: Many school leaders are already stretched thin, spending hours each week just covering staff absences. Is there a smarter way for schools to manage casuals and relief staff without slipping up on compliance?
Absolutely. School leaders are currently spending up to 20% of their time managing staffing gaps, time that should be focused on teaching and learning. A smarter approach involves adopting structured, tech-enabled workforce management systems that automate casual bookings, align pay rates with award conditions, and ensure proper classification.
At Discovery Consulting, we've supported large school systems, such as Catholic Education in Parramatta, with modern workplace management solutions that manage diverse casual pools across 80+ schools. When implemented correctly, these platforms give schools visibility, reduce administration stress, and ensure compliance without complexity.
The key is integrating technology that supports both flexibility and control, so casuals are managed efficiently, meet compliance requirements and schools remain protected against the growing complexity of regulatory demands.
TE: Are schools – especially those in rural or remote areas – properly set up to handle things like correct staff classification and pay? Or are we leaving some schools exposed because they just don’t have the systems or support in place?
Many rural and remote schools are unfortunately operating at a disadvantage. While they face the same compliance obligations as metropolitan schools, they may lack the resources available to their metropolitan counterparts. However, with cloud solutions providing scalable solutions, it is now practical for remote and smaller schools throughout Australia to leverage the same solutions available to larger based schools.
We see the challenge of rural or remote schools being that they generally lack the ability to have a pool and diversity of casual teachers. Hence the focus of attracting and retaining staff is even more critical to them, than solutions of casual teacher management.
The focus across the board for our education providers, needs to be to provide solutions that reduce the administrative burden on our teachers and allow them to focus more on the classroom activities.
TE: With so many schools now leaning heavily on casual teachers, what should Australia’s school leaders be doing to make sure workforce planning stays on track – and within the law?
Increasing reliance on a casual workforce means that schools are competing amongst each other to secure the best staff on any given day. Those schools that can make the experience for both the casual workforce and the school leadership as streamlined as possible will prevail in this competitive market as they are then able to focus on the core delivery of quality teaching for students. Workforce planning spans the range from strategic to very tactical, with both ends of the scale and all the pieces in between vitally important to the smooth running of a school. School leaders need to be able to understand how their workforce is evolving, where their talent is being developed and linking this to fluctuating student intakes.
That starts with having an accurate, centralised view of staffing data and award and EA obligations, something many legacy systems simply can’t provide. With more modern workplace management systems, schools can, for example, manage multi-site casual pools, ensure correct entitlements, and maintain visibility across the network. It’s crucial for compliance and talent development to be embedded at the core of workforce planning, as opposed to treated as an afterthought.