Senate debates

Monday, 2 March 2015


Fair Work (Registered Organisations) Amendment Bill 2014; Second Reading

5:36 pm

Photo of Eric AbetzEric Abetz (Tasmania, Liberal Party, Minister for Employment) Share this | Hansard source

I thank all honourable senators for their contribution to this debate on the Fair Work (Registered Organisations) Amendment Bill 2014 but, let's be frank, some more than others.

Registered organisations play an important role in the affairs of workplace relations in this nation. Registered organisations are given special privileges under the Fair Work Act. With those privileges should come countervailing responsibilities. Every year, hundreds of thousands of people pay hard-earned wages as dues of literally hundreds of dollars per annum to unions and small businesses, similarly to employer organisations in Australia. Those organisations are known as registered organisations. Regrettably, the rorts, the rackets and the rip-offs have been in the media on an almost daily basis. Think Williamson; think Thomson; think Transport Workers Union, the CFMEU and, indeed, the Australian Workers Union. The community strongly favours these reforms.

Until this parliament acts, Australia will not have a sufficiently robust system to ensure that the sort of corruption that was revealed during the numerous scandals can be uncovered and eradicated. It is already systemic. To do nothing is not a responsible option. It is simply no longer tenable to argue that the present system is adequate to deal with or discourage the kind of behaviour that we have witnessed. The government believes that the majority of registered organisations do the right thing and indeed, in many cases, maintain higher standards than those who are currently required or would be required under this legislation.

However, the recent investigations into the Health Services Union illustrate that, unfortunately, financial impropriety can and does occur under the current governance regime for registered organisations. The charges and allegations against the former ALP member of parliament Craig Thomson and the former ALP national president Michael Williamson, in their capacity as officers of the Health Services Union, are shocking and unacceptable. Mr Thomson is still facing allegations that his 2007 federal election campaign was partly funded by siphoning union money without authorisation. Mr Williamson has pleaded guilty to misusing almost $1 million of Health Services Union members' funds. Mr Williamson has also been accused of destroying documents and hindering investigations.

Members of the Health Services Union are rightly asking how this gross breach of trust could happen. Questions have also arisen with numerous other registered organisations. Members of registered organisations are asking whether this could happen in their organisation. For those of us who worked in the parliament in earlier years, Mr Shorten and Senator Wong were the chief defenders of the Mr Williamsons and the Mr Thomsons of this world. Regrettably, the ALP and Greens political parties are the recipients of literally hundreds of thousands of dollars from these organisations. That is why they are so silent on matters of corruption in these organisations, and I fear that they are the beneficiaries of some of the 'funny' money that gets slushed through some unscrupulous trade union activities.

The Health Services Union investigation exposed significant shortfalls in the current framework. The investigation into Mr Thomson of the Health Services Union by the Fair Work Commission has cost taxpayers almost $4 million. The report took three years to produce and now, eight years after the initial breaches, court action is still being heard. Clearly, there is something wrong with the framework. That is why there is a need for this bill.

This bill will establish an independent watchdog, the Registered Organisations Commission, to monitor and regulate registered organisations with enhanced investigation and information-gathering powers to ensure that the law is being upheld. It will strengthen the requirement for officers' disclosure of material personal interests and related voting and decision-making rights, and it will change the grounds for disqualification and ineligibility for office. It will strengthen existing financial accounting, disclosure and transparency obligations under the registered organisations act by putting certain rule obligations on the face of the registered organisations act and making them enforceable as civil-remedy provisions.

It will increase civil penalties and introduce criminal offences for serious breaches of officers' duties as well as introduce new offences in relation to the conduct of investigations under the registered organisations act. It will fix the rushed amendments made by the former government that require even some shop stewards around Australia to disclose their husband's, wife's or children's income and assets. That was alluded to by Senator Xenophon's very considered contribution in this debate. They were requirements imposed by Mr Shorten, the current leader of the Australian Labor Party, and we want to fix that mess. More on that later.

I want to take some time to address some of the concerns that have been raised by senators. In relation to penalties, it is important that the government's expectation is that the top penalty will only be imposed, if at all, for the most heinous of offences. The penalties will be imposed by none other than the courts. We know that the courts have had an issue with the current framework, when even Federal Court judge Anthony North made these almost unprecedented comments last year:

The penalties [under the current Act] are rather beneficially low…beneficial to wrongdoers.

In other words, the penalty does not fit the gravity of the offence. So why would any senator seek to vote to keep that situation in place, when even Federal Court judge Anthony North has come to that conclusion? It is very compelling, very persuasive, and it is a matter of regret that the Australian Labor Party and the Greens have not succumbed to the logic and wisdom of Justice North on this occasion.

I simply pose the question: why should a corrupt union official who has ripped off hundreds of thousands of dollars from a union only be liable for a fine of $10,200 when, for the same corrupt conduct, a company director would be liable for five years imprisonment or a fine of $320,000? What is the material difference, what is the moral difference, between a company director ripping off shareholders and a union official—or, for that matter, an employer official—ripping off members? There is no moral difference, there is no material difference and the penalties should be as close as possible.

Some registered organisations have indicated concern that the new penalties will mean that they have will have difficulty persuading people to take on official responsibilities. If that is the case, it is a sad reflection and, quite frankly, I do not believe it. It is very simple: no wrongdoing, no penalty. And the penalty, of course, would in any event be court imposed. The only people who have anything to fear are those who are doing the wrong thing. A rigorous structure and process will be in place for investigation and prosecution of alleged wrongdoing. Officers who are operating within the law—which is, might I add, the overwhelming majority of them—will have no reason to fear taking on official responsibilities. The overwhelming number of officers who are already doing the right thing should be comforted in knowing that unlawful behaviour will be dealt with, thus ensuring ongoing member confidence in registered organisations as a whole.

Very importantly, I would invite honourable senators to recognise that this bill actually cleans up the mess created by Mr Shorten and the former government. Our legislation will amend the disclosure requirements for officers of registered organisations, to more closely align them with the Corporations Act so that the requirement to disclose material possession personal interests applies—and I stress this—only to those officers whose duties relate to the financial management of the organisation. That is a change we would make from the current law. I simply say to those who have railed against these provisions and the others I go through: keep in mind: vote this bill down and all those provisions will remain and we will be seeking from the Fair Work Commission their attitude in relation to pursuing all these requirements that the Labor Party put into the legislation and that Senator Bilyk and others championed.

We will also remove the more invasive disclosure requirements for officers to report family members' income and assets, thereby more closely aligning with the Corporations Act. That exists now, ham-fistedly put into the legislation by Mr Shorten, and it now has dire and inappropriate consequences for those who want to be involved in the trade union movement or employer organisations. The bill will align the material personal interest disclosure requirements for officers so that disclosures only need to be made to the governing body and not to the entire membership. Mr Shorten's legislation now requires it to go out to the entire membership—a complete breach of privacy. But where are the Greens on this? Nowhere to be heard on this breach of privacy, because it is okay because Mr Shorten did it. You can actually get rid of this provision by supporting this legislation.

We will limit disclosures of related party payments to payments made above a certain prescribed threshold and with certain other exceptions based on those exceptions in the Corporations Act for member approval of related party transactions, and we would provide the Registered Organisations Commissioner with the discretion to waive training requirements of officers of registered organisations. For example, if a member is a certified and practising accountant, they would not have to go through the course being provided by the Fair Work Commission—another example of Mr Shorten's ham-fisted approach. The unions want this removed—they admit that; they acknowledge that—but they do not want the extra penalties, and that is why they have taken this regrettable attitude to this legislation, and that is why the Labor Party, in lock-step with them, are doing the same.

Let me be very clear: unless these amendments pass this parliament, officials of registered organisations will run the very real risk of being in breach of the laws as they stand today in relation to the issues identified by the opposition themselves. When they are enforced and all the people out there rightly complain about the enforcement of these provisions, we will say to them: 'Thank the Australian Greens and the Australian Labor Party for not removing these provisions when they actually had the opportunity of doing so and assisting in cleaning up certain elements in the trade union movement.'

It does seem passing strange that we get lectures from those opposite, including the crossbench, that this is somehow an ideological attack on workers and that we somehow believe that all unions are corrupt. Even if you might think that that is what we think, you are wrong. Even if you were to park that to the side, why is it that Paul Howes, a former secretary of the Australian Workers Union, was able to say on 26 November 2012:

The reality is I do not have any issue with increasing the level of requirements and penalties on trade unions for breaching basic ethics like misappropriation of funds.

It is pretty simple stuff. Mr Howes does not have a problem. Another former leader of the Australian Workers Union and indeed of the Labor movement, now Fair Work Commissioner, Ian Cambridge, made similar commentary, as did former Labor Attorney-General Robert McClelland and two former ACTU presidents and Labor ministers, in Martin Ferguson and Simon Crean. They are somehow embarked on this ideological attack on workers?

No, they are decent trade union leaders that have seen a once proud organisation brought into the gutter through corruption, and they want to see it cleaned up, and we as a government do as well.

I note that our friends in Palmer United have issued a media release today saying that they would abstain from voting on any 'legalisation' proposals. Here we are not seeking to legalise anything—in fact, we are trying to ensure that certain things are made illegal—so I would invite them to vote for us on this matter, albeit I think there might be a spelling mistake and they meant 'legislation' rather than 'legalisation'. But I will take it at its face value and say that we are not seeking to legalise anything with this; we are in fact intending to make illegal certain activities.

In relation to Senator Xenophon, I do give him an undertaking that, in the event that there are any unintended consequences, of course we as a government would seek to deal with them in an expeditious manner, because what we want out of this is a clean system of registered organisations, be they trade unions or employer organisations, so that members can have confidence in the way that their organisations are run. In relation to the advisory service, that is already being provided as we speak—albeit in limited form, I would suggest—by the Fair Work Commission. When, if this legislation is passed, the Registered Organisations Commission becomes a node within the Fair Work Ombudsman, that educative role would, of course, continue.

Can I now quickly return—time escapes—to those matters referred to by Senator Cameron in one of his excellently impassioned speeches—but completely devoid of facts. He asserted that the Ai Group had stated their opposition to the legislation. We heard from Senator Xenophon that they actually support it. For Senator Cameron to come into this place and assert one thing, whereas Senator Xenophon can actually quote a letter saying the exact opposite, indicates the paucity of factual information that Senator Cameron brings to these debates.

He suggests that the bill proposes to amend the act to restrict officers from taking part in certain decisions. It goes for page after page. Each and every one of his allegations relates to the legislation that is in place already, courtesy of the Australian Labor Party's ham-fisted approach in an attempt to gazump us when we announced our policy for a Registered Organisations Commission. In his ham-fisted approach, all the ills that Senator Cameron refers to are in fact already in the legislation, and we seek to remove them from the legislation and do him a favour. The only thing we are really asking for is that there be an increased regime of penalties and a bit more transparency. Senator Cameron, the Labor Party and the Greens want to live with all these things that they are against for fear of increased penalties. Why are they scared of the courts imposing penalties if a wrongdoing has been uncovered?

In relation to another senator, who suggested that the right to silence was somehow being removed, it is already there. There is no change in that area whatsoever. If that is a reason to vote against the legislation, because of something that is already in the legislation, it is a bit hard to engage in that debate.

In the final seconds, can I simply say that this is a policy on which the government ran at the last election. It was well and truly ventilated and put before the Australian people. There were no ifs and buts. People knew exactly where we stood on this important issue. We introduced this legislation within the first sitting week of the parliament because we considered it to be so important, and now that it has come before the Senate again I invite the Senate to support the legislation.


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