Layoffs paused at UTS after watchdog cites ‘serious risk’ to staff wellbeing

The University of Technology Sydney (UTS) has been ordered to pause its latest wave of job cuts after New South Wales’ workplace safety regulator intervened, warning the process posed a “serious and imminent risk of psychological harm” to staff.

In a prohibition notice issued on Tuesday, SafeWork NSW told the university to halt meetings and consultations linked to its Operational Sustainability Initiative, a cost-cutting programme that aims to remove A$100 million from the budget by 2029. At least 400 roles are earmarked for redundancy, including 150 academic positions. The order is unprecedented in the higher education sector and, workplace lawyers say, may reshape how mental health risks are handled in white-collar workplaces.

The intervention follows months of unrest at UTS, where Vice-Chancellor Andrew Parfitt has defended the restructuring as essential to restoring financial stability after deficits of A$107 million in 2023 and A$81 million in 2024, as reported by The Australian Financial Review. Staff, however, have described mounting anxiety, a lack of consultation, and “psychological harm”, claims that formed the basis of complaints made to regulators.

SafeWork confirmed inspectors believed UTS had failed to manage psychosocial risks “so far as is reasonably practicable”. It directed the university to stop consultations, delay releasing its academic change proposal, and ensure future plans explicitly address staff mental health with input from employees. The Guardian described the move as “a rare and extraordinary step” in a white-collar workplace. 

Prohibition notices are considered among the most severe regulatory tools and can only be issued if inspectors hold reasonable suspicion of imminent risk to health and safety.

Staff distress at breaking point

The university’s staff have been voicing concerns for months. A leaked survey by the National Tertiary Education Union (NTEU), reported by ABC News, found that more than a third of UTS employees were experiencing “very high levels of psychological distress” linked to job insecurity and poor communication. Criticism deepened after the university circulated wellbeing tips suggesting staff “wash delicates” or “brush your teeth” as stress relief — advice widely condemned as trivialising.

The NTEU welcomed SafeWork’s notice. National president Alison Barnes said: “The fact that a workplace safety regulator had to step in to protect university workers speaks volumes about how disconnected university management has become” 

UTS response: frustration and delay

UTS acknowledged the notice but argued it would prolong uncertainty for staff. “The safety and wellbeing of our staff are of paramount importance,” a spokesperson said, quoted in The Australian. “We are frustrated by the ongoing delays in releasing the change proposal for consultation and are very concerned about the impact this is having on our community.”

The university maintains that the restructuring is necessary to ensure financial and operational sustainability, with Parfitt warning that without cuts, UTS’s long-term viability is at stake.