Linda Reynolds (WA, Liberal Party) Share this | Hansard source

I too rise today to discuss the Fair Work (Registered Organisations) Amendment Bill 2014. In Australia, I believe it is reasonable for all Australians to expect those who represent their interests and are responsible for managing their funds to all be held to the same standards of transparency and accountability. Across Australia today there are 47 unions and 63 employer groups that have between them revenues of $1.5 billion and assets of over $2.5 billion. This is the money of more than two million hardworking Australian men and women who trust these organisations with their money and with the responsibility to look after their interests. These millions of hardworking Australian men and women pay their union dues and they deserve to know that their union, or their employer group, is acting in their best interests. Considering that these organisations are also exempt from paying income tax, all Australians also deserve to know that they are fully accountable.

I agree with Senator Pratt and those opposite that unions are critically important to Australia and to Australian workers. But unions, like every other organisation in this country that manages people's money and looks after their interests, must be held to the highest possible standard of accountability and transparency. But, scandalously, these organisations and their directors are not currently held to the same standards of accountability and responsibility as companies and company directors are. No amount of highly skilled verbal gymnastics from those opposite can hide the fact that what many union officials are doing is quite simply wrong; in fact, it is very wrong. Many high-profile union officials, and even former Labor attorney-general Robert McClelland, have called for these reforms. In 2012 Mr McClelland was quoted in The Australian as saying 'there is unquestionably a case for further legislative reform'.

Those opposite, who profess to be for the workers, are protecting and perpetuating an endemic culture of entitlement and abuse by union officials. Not only is this culture evident in the workplace, it is also seen in the ranks of the union officials themselves. Currently, there are 113—yes, 113—CFMEU officials before the courts. In fact, there are currently 10 from Western Australia before the courts—making a total of 24 in all from my home state of Western Australia, which is utterly scandalous. In recent years, courts have imposed more than $8 million in fines on the CFMEU alone. As numerous judges have observed, these penalties are not enough for unions that treat law-breaking as standard procedure, as business as usual. The $8 million in fines, paid for by union members' dues, are akin to parking tickets. They are simply seen as a cost of doing business. That is scandalous. That is an abuse. It is, absolutely, evidence of an endemic culture of union abuse and of unions rorting their membership.

If company directors were found to have behaved in the same way that, so far, over 100 officials just in the CFMEU have, they would be out of a job quick smart. They would be dealt with swiftly by the appropriate regulatory authorities and by the courts. Those opposite would be the first ones—in this place and in public—decrying, as they should, any such transgressions or abuse by the corporate sector. I simply cannot understand how those opposite can rationalise the systemic and endemic exploitation of Australian workers—the men and women who are members of unions and who pay their union dues, often at some financial hardship to themselves. Yet those opposite remain silent on the gross abuse of workers whom they so loudly profess to support. As we have seen in this place today, they keep trotting out the same old tired class-warfare rhetoric instead of actually standing up to the unions and saying: 'It is wrong. It is time to you to change.'

The facts are indisputable. Decades and decades of royal commissions and reviews have identified a clear culture of entitlement to other people's money when it comes to the unions. Sadly, in the absence of acceptable transparency and accountability standards, abuse of union members' fees is endemic. Today, many—certainly not all—union officials use their members' fees as their own personal ATMs. Just look at the audacity of two senior Western Australian Transport Workers Union officials who used branch funds to purchase themselves expensive imported Ford utes at a price of more than $150,000 for each ute. These union officials purchased their utes courtesy of union membership funds, and then they used them as their own personal vehicles. One official felt so comfortable using his union membership fee funded car that he put personalised plates on the car. It did not stop there. Just before they purchased these expensive imported cars, they had organised redundancies for themselves so that the vehicles could be taken with them when departing the union. So not only did one of the officials receive a redundancy payout of $500,000; he took his $150,000 souped-up Ford ute—paid for by union members—with him. Where were those opposite when this happened? Where were my Western Australian colleagues in this place when this happened? Why weren't you standing up for the TWU workers when they were so egregiously ripped off? As we all know, the audacity of union officials and others who rort any organisation just gets bigger and bigger if left unchecked.

In 2015, former Health Services Union national secretary Craig Thomson was found guilty of misusing $300,000 for his own campaign to enter parliament and for his many personal indulgences and proclivities, as we now know. His colleague Kathy Jackson also fleeced more than $1 million through cash withdrawals, holidays, artworks and other luxuries. The membership funds of the Health Services Union funded this nearly $1.5 million of personal expenditure. Where were those opposite? Where were those opposite decrying the exploitation of workers? This money had come from nurses, from hospital cleaners and from disability and other healthcare workers who paid their annual fees to their union to be represented. Instead, they were funding a luxurious lifestyle for these officials. Where were those opposite when this happened? These are the hardworking, honest Australians who take care of our most vulnerable people, often for minimal pay—and this is the thanks they were given by the unions who they were paying to represent them. This theft could only happen because of the lax legislation and because these union officials were able to exploit the lack of transparency.

But it does not stop there. In the most recent trade union royal commission, many other rorts and deceptive conduct by union officials came to light. For example, officials from the National Union of Workers spent money on personal holidays and a dating website. I am sure the membership of the NUW would be delighted to know they were funding the dating habits of their union officials! One NUW official even used members' fees to spring for a KISS concert corporate box for his family. He used his union card to pay $7,740 for a corporate box at a KISS concert, which was the subject of the famous 'I was made for rorting you' story in The Daily Telegraph. The same New South Wales secretary of the NUW spent nearly $5,000 on his union credit card for a New Year's Eve party for his family and $1,500 on a flight for his wife to Hong Kong. Where were those opposite when NUW members were being so egregiously rorted? They were nowhere to be seen. But it did not stop there in the NUW. Officials and staff used their corporate cards to buy luxury holidays worth more than $18,000, sports tickets worth over $4,000 and toys worth $670; to spend over $2,500 on dating websites; to spend money on hairdressing and iTunes purchases; and to spend more than $1,500 on other personal purchases.

Shockingly for me as a senator for Western Australia, CFMEU officials who were receiving kickbacks from underworld figures raided redundancy funds for staff. Redundancy funds were raided to pay workers who were unlawfully striking on the building site of Perth's new children's hospital. That is beyond contempt. Where were those opposite? Where were my Senate colleagues from the Labor Party when all this was happening? Nowhere to be seen and nowhere to be heard.

The TWU appointed its own assistant state secretary, Mr John Berger, as the Tasmanian superannuation liaison officer for TWU Super from 2009 to 2012. In the financial year 2011-12 Mr Berger spent five days in Tasmania—five days. How much do you think he got paid by the union for five days of work? He got $93,434 for five days work. Mr Berger finally had to agree, albeit somewhat reluctantly, that the invoice put in for $93,000 was actually for 2½ days work, not even five days work.

When he was the AWU National Secretary, the Leader of the Opposition's union accepted a secret donation of $40,000 from Cleanevent to fund his campaign for parliament—a fact he disclosed only when it was exposed by the royal commission. In his capacity as AWU National Secretary, Mr Shorten also signed an EBA with Cleanevent that cut the number of award conditions. Yes, it cut award conditions, including penalty rates, for the workers of his own union. What was the cost? What did he get in return? Cleanevent agreed to pay the union $25,000 per year for three years in return for the names of their workers and a deal that stripped the workers of their penalty rates. That is scandalous. And where were those opposite standing up for the workers? Mr Shorten was the organiser for Cleanevent when it entered a 1999 EBA with the AWU and was reportedly responsible for the 1999 deal that set low pay and conditions that applied not for the next four years or 10 years but for 15 years.

Mr Cesar Melhem of the Australian Workers Union repeatedly issued false invoices to companies, marking them 'training', 'OH&S' or similar, when they were in fact used to pay union membership, to boost the union's power within the ALP. He issued false invoices to raise money to pay for extra influence in the Labor Party organisation itself. The AWU membership roll contains the names of workers and horseracing jockeys who had never even agreed to become members of the union. Where were those opposite when the AWU workers were again being ripped off by their union?

From these few examples—and sadly there are many, many more—it is clearly evident that the current laws in force are far too lax and do not ensure that unions and employee group officials are suitably accountable and acting in the best interests of the workers they represent. Over four years our systems and laws have remained unchanged. Hardworking Australians are still being shamelessly exploited and ripped off by unions and employee group officials. This is why the coalition government has introduced this bill, to ensure that the interests of all hardworking Australian men and women, whether they are championed by unions or not, have their best interests looked after.

But it is not just those on this side of the chamber who are seeking equal standards of accountability and transparency to protect Australian workers from the worst excesses of rogue union officials. For example, the former AWU Secretary Mr Paul Howes said: 'I can't see any reason why anyone in the union movement would fear having the same penalties that apply to company directors.' This is Paul Howes, and he said this:

If you're a crook, you're a crook.

How true. Former ACTU President Martin Ferguson himself, no less, said:

There is an absolute obligation on the union movement to clean up its house. There is an obligation on the unions to put their house in order.

Former ACTU Secretary Bill Kelty said:

I was always on that side of the debate which said that unions are public bodies so they are accountable to members for their management.

Senator Urquhart herself in this chamber stated in 2015 that it was her belief and Labor's belief:

… that officers of registered organisations or anyone in a position of trust who misuses the funds of members, who acts inappropriately or who takes benefits that they are not entitled to must never be condoned.

I would like to address two issues that Senator Pratt raised in relation to her amendments. The first one is the proposed ALP amendment in relation to ASIC being the regulator. Commissioner Heydon considered in detail whether ASIC should regulate registered organisations and he strongly recommended against this approach. He believed, after careful consideration, that transferring the regulation of registered organisations to ASIC risked diverting ASIC from its core responsibilities, which is the regulation of corporations and of financial services. It could also result in inadequate focus on the regulation of registered organisations. Additionally, he observed that 'sharing the regulation of registered organisations between ASIC and the Fair Work Commission would cause many great practical and administrative difficulties from having two regulators regulating in the same space'. I think it is very clear from the outcomes of the trade union royal commission that it is absolutely essential that there is a strong and dedicated regulator of registered organisations.

One of the other amendments that Labor is proposing, which Senator Pratt raised, relates to volunteers being excluded from this bill. In our view, that would be a seriously retrograde step, because currently all officials, whether they are paid or whether they are volunteers, have responsibility for financial management and have obligations under the Fair Work (Registered Organisations) Act 2009. Our amendments to the act will not change the current situation.

There are actually a number of very important reasons for this, but I will give you two words: Kathy Jackson. Kathy Jackson is the exact example of why this should not change. In her last position with the HSU, she was a volunteer. Those opposite may not have known this, but she was a volunteer. She was the honorary national secretary. Under Labor's proposal, she could not have been held accountable for any wrongdoing in her role, because she was a volunteer. Labor must surely know that their proposed amendments to exclude volunteers would create a major loophole that could be exploited by an official with bad intentions, such as Kathy Jackson. There is absolutely no reason why the misappropriation of members' funds by a volunteer should be considered less serious than misappropriation by a paid official, because, as Martin Ferguson said, a crook is a crook, whether they are paid to do a job or whether they are a volunteer. This approach has been taken for charities and not-for-profit organisations, where directors, who are often also volunteers, are not exempt from Corporations Act obligations. We see no good reason why that should change.

The facts are very simple and clear. If those opposite were truly acting for the benefit of hardworking Australians, and of union members in particular, they would genuinely believe that a crook is a crook and that it does not matter whether you are paid, a volunteer, a company director or a union official—you should be subjected to the same standards of accountability and transparency. It is a very simple and clear prospect, and the Australian people deserve nothing less.