NAB to take $130 million hit after underpaying staff

NAB will take a $130 million hit this year after an internal review found it had underpaid staff.

The big four bank told investors today that its operating expenses will be 4.5 per cent higher this financial year due to the costs for the review and remediation of payroll issues.

The final cost could be even worse as the bank warned that its "payroll review and remediation is ongoing and total costs remain uncertain".

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Some of the issues relate to job sharing, rosters and wage and leave entitlements.

NAB is beginning remediation with staff and a broader review into payroll-related benefits under current and former employee contracts.

The bank could not say how many staff were affected.

NAB group executive of people and culture Sarah White apologised to staff, adding that "paying staff correctly is an absolute priority".

"We are sorry and apologise to our colleagues that this has happened and have commenced remediating those impacted," she said.

NAB's chronic payroll issues were first identified in 2019, with a review finding that the bank incurred $250 million over two years.

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An ongoing review, as well as new human resources and payroll platforms and the transition of staff to a new enterprise agreement, identified the further issues announced today.

NAB will also work with the Fair Work Ombudsman and the Finance Sector Union.

Finance Sector Union national president Wendy Streets said the money should "never have been taken from workers in the first place".

"At a time when Australians are struggling through the worst cost-of-living crisis in decades, this scale of underpayment is nothing short of systemic wage theft," she said.

"The Finance Sector Union has met with NAB, expressing its disbelief that one of the nation's biggest banks has once again failed to pay its workers correctly."

NAB and the Finance Sector Union will meet again this month, where Streets will be demanding guarantees that workers will never be "ripped off" to this scale again.

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While the bank told investors of the $130 million hit, it simultaneously posted that it made $1.8 billion in cash earnings in the three months to June.

NAB saw a two per cent increase in underlying profit in the third quarter, and a four per cent rise in business and banking lending.

The bank grew its home loans by two per cent.

NAB chief executive Andrew Irvine said the payroll issues were "disappointing and must be fixed", but remained optimistic.

"We remain optimistic about the outlook and are well placed to manage NAB for the long term and deliver sustainable growth and returns for shareholders," he said.

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