Monday’s long awaited passage of the Registered Organisations Bill has been touted as a much-needed win for the Turnbull Coalition Government. But the real winners are Australia’s 1.6 million union members whose dues have too often been deployed to ends far removed from their rights at work.
The Registered Organisations Bill will make serious inroads towards fixing the culture of lawlessness and corruption that has taken root in some quarters of Australia’s trade union movement.
The bill addresses the current shortfalls in union transparency and accountability in three key ways:
- Subjecting union officials to broadly the same standards borne by company directors under the Corporations Act
- Strengthening financial and transparency requirements, including mandatory reporting
- Increasing civil penalties and imposing criminal liability for union officials who engage in serious breaches of their statutory duties. Critically, repeat law-breakers can be barred from holding future office. Unlike the former penalties prescribed by the Fair Work Act, this will mean law breaking can no longer be regarded as the cost of doing business.
These changes are not before time. Compared to the stringent standards of accountability faced by corporate office bearers, the union movement has long operated in a legal vacuum. The funds at stake are more than chump change. With the union movement and employer groups holding more than $2.5 billion in assets and enjoying annual revenue of $1.5 billion, ensuring the financial probity of these groups is squarely in the public interest.
The deficiencies of leaving trade unions to operate as unincorporated associations was laid bare by the findings of the Heydon Royal Commission. The Commission uncovered embezzlement in the order of millions of dollars, repeated instances of financial maladministration and myriad examples of officials profiting from clear conflicts of interest.
The recent rap sheet of the CFMEU is a case in point. More than a quarter of the union’s employees have either been convicted or are facing charges for over 1,000 industrial breaches in the last year alone. Over the past decade, the union has amassed more than $8.25 million worth of fines, bankrolled by the dues of members who give up a small slice of their salary to the union every fortnight.
How many other organisations in Australia use their members’ fees to bankroll a bargaining model that regards lawbreaking as a standard negotiating tactic? At a minimum, the Registered Organisations Bill would weed out the ringleaders of this diseased culture for good.
Likewise, under financial disclosure requirements of the bill it’s unlikely that one-time Health Services Union whistleblower Kathy Jackson would have been able to rack up $1.4 million of wrongful expenditure undetected over ten years.
Many of Australia’s trade unions boast balance sheets of up to hundreds of millions of dollars and membership lists totalling tens and sometimes hundreds of thousands of names. Charged with managing industry super funds, conducting enterprise bargaining negotiations and representing employees in workplace disputes, unions remain an integral part of Australia’s industrial relations interface. It’s in the interests of not just members, but employers and union officials themselves that public trust and confidence in the union movement is not undermined by illegality and sleight of hand that would see corporate office bearers consigned to a jail cell.
The fact that union membership has fallen from 40 per cent of the workforce to a mere 15 per cent in just two decades – shedding 140,000 members in the last 12 months alone – is no small measure of the growing juncture between the movement and Australia’s modern employment landscape.
On that score, Bill Shorten’s comments that Malcolm Turnbull is ‘obsessed with destroying unions’ are striking for their glaring lack of self-awareness. What faster way to destroy the union movement than allowing its reputation to be plundered by unscrupulous officials who have made a career out of hanging members out to dry?
The Senate crossbench should now pass the Government’s ABCC bills as a matter of urgent priority. Restoring confidence and order to Australia’s embattled union movement and construction sector are both worthy, albeit modest, steps towards an industrial relations system that promotes economic growth underpinned by the rule of law.
John Slater is Executive Director of the HR Nicholls Society
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