USU organiser Luke Hutchinson said the council was exploiting a "loophole" and perpetuating a "sham arrangement" by employing up to 10 casual workers under the Civic Theatre Award, which applies to the adjacent council-owned premises, instead of hiring them under the City of Newcastle Enterprise Agreement.

And Mr Hutchison claims that council had threatened to sack workers and outsource catering arrangements if the union took the matter to the commission.

"The Civic Theatre Award allows the council to conveniently pay these catering assistants less, which is an outrageous example of wage theft and exploitation of young people," Mr Hutchinson said. "What's worse, is that the chef hired to run catering operations at Newcastle City Hall is properly employed under the council's enterprise agreement. "If proof were needed that this arrangement is a wage rort by the council, employing the boss under one arrangement and the assistants under another amounts to exploitation and an issue we will be putting to the commission."

A City of Newcastle spokesperson said casuals working functions at Newcastle City Hall are employed by Civic Theatre and have been paid under the Live Theatre and Concert (State) Award for more than twenty years. The spokesperson said three years ago the union signed the City of Newcastle's Enterprise Agreement, "which very clearly states that casuals working at the Civic Theatre are paid under the Live Theatre and Concert Award". "It's therefore very disappointing that the union has now changed its position within weeks of the Civic Theatre reopening its doors," the spokesperson said.

But Mr Hutchison said the council had not engaged in collective bargaining "for years" and the current arrangement meant they were able to exploit a "loophole" and use an award that does not include penalty rates.

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