The Coalition Government will this week introduce a Bill to ban secret corrupting payments between businesses and unions and require the disclosure of any legitimate payments in response to the Heydon Royal Commission into union corruption.
Federal Member for Forde Bert van Manen MP said the Heydon Royal Commission uncovered a raft of payments between unions and employers designed to ensure companies received favourable treatment from the unions.
“He called these payments ‘corrupting benefits’ and were often disguised by false invoices marked as payments for ‘training’ or similar, made as part of a deal in enterprise agreement negotiations, or accompanied by lists of employee names who were secretly joined to the union,” Mr van Manen said.
“Some officials were paid private kickbacks that they used for personal gain such as former CFMEU Qld official Dave Hanna who used free building materials and labour to renovate his home in Cornubia.”
Mr van Manen said some officials used threats to pressure employers to pay them money in order to bolster union coffers, like former CFMEU ACT official Fihi Kivalu who demanded cash for work in Canberra; or the NSW CFMEU who demanded employers pay “donations” to a drug and alcohol rehabilitation fund from which they secretly siphoned money for their union.
“Others extracted payments to bolster their status and power, particularly within the Labor Party.
“Bill Shorten and Cesar Melhem were very effective at this, regularly signing employees up to the union without their knowledge and securing ongoing payments to the AWU in Victoria,” Mr van Manen said.
The Heydon Royal Commission revealed a number of secret payments, many cases involving Bill Shorten’s own union, the AWU Victoria. These include:
- Thiess’ John Holland paid AWU Victoria $300,000 plus GST while they built the Eastlink freeway extension in Melbourne’s eastern suburbs. The AWU issued false invoices to disguise the payments as ‘training’, ‘back strain research’, ‘AWU magazine advertisements’, ‘forum tickets’ and ‘conference sponsorships’ – but none of these benefits were actually provided. The payments were never disclosed to AWU members or employees.
- ACI Operations paid AWU Victoria around $500,000 while they laid workers off at their Spotswood glass manufacturing factory. The AWU invoiced the payments as ‘paid education leave’, but the payments were predominantly used to offset a loan to renovate the union’s Victorian office and for other general union costs.
- Cleanevent paid AWU Victoria $75,000 to maintain an enterprise agreement that paid cleaning workers well-below award rates and stripped them of penalty rates, overtime and shift loadings. The payments were detailed in a secret letter between the AWU and Cleanevent and never disclosed to the cleaning workers. Level 1 casuals working at events were entitled to 176% more per hour under the award than under the agreement sealed by these payments.
- Unibuilt paid Bill Shorten $32,000 to fund his 2007 election campaign manager while the company was negotiating an enterprise agreement with the AWU for which Shorten was National Secretary.
- Chiquita Mushrooms paid AWU Victoria $24,000 while it was casualising its mushroom picking workforce. The AWU falsely invoiced the payments as ‘paid education leave’ and never disclosed the payments to Chiquita employees.
- Winslow Constructors paid AWU Victoria around $200,000 and provided the union lists of employee names who were secretly signed up to the union. The AWU hid the payments behind false invoices for ‘OHS training’, ‘workplace inspections’ and similar.
Mr van Manen said the Coalition Government would solve the issue of ‘corrupting benefits’ payments by banning illegitimate payments and require the full disclosure of legitimate payments.
“The Government is committed to restoring integrity and fairness to workplaces,” Mr van Manen said.
“This starts with requiring employers and unions to act with integrity and fairness in negotiations.
“The Heydon Royal Commission recommended outlawing such secret payments so the Government will amend the Fair Work Act to make it a criminal offence to give, receive, offer or solicit such payments. This prohibition will apply to unions and employers.”
Certain legitimate payments will be allowed, such as payments to unions for genuine services that are actually provided.
Where legitimate financial benefits would arise from the terms of a workplace deal, the Government’s changes will also require these benefits to be fully disclosed to employees before they vote on the deal.
“Bill Shorten and the Labor Party should now support this important reform to outlaw corrupting benefits and clean up the unfair, secretive, and often corrupt payments that have tainted Australian workplaces for decades,” Mr van Manen said.