Push to eject hundreds of CFMEU officials in watchdog probe

Australia’s union watchdog wants to oust hundreds of CFMEU officials, including national secretary Zach Smith, claiming the construction divisions of the troubled union can no longer function effectively.

Documents released by the Federal Court on Wednesday show the full extent of the Fair Work Commission’s probe and the root-and-branch clean out it says is required.

CFMEU headquarters in Melbourne.Credit: Penny Stephens

The action is the result of repeated adverse findings made by courts around the country, and allegations raised in the Building Bad investigation by this masthead, The Australian Financial Review and 60 Minutes.

The court documents reveal the Fair Work Commission is seeking to vacate 300 current union positions in branches throughout the country, including the leadership team of national construction division secretary Smith, construction president Jade Ingham and national assistant secretaries Jason Jennings and Andrew Sutherland.

Victorian branch assistant secretaries Derek Christopher and Elias Spernovasilis, Victorian/Tasmanian division branch president Robert Graauwmans and NSW construction boss Darren Greenfield also face ejection. Twenty positions are already vacant, and some office holders can have more than one title.

The commission is also seeking orders that all officeholders surrender cars, building and security passes, credit cards, mobile phones and laptops, passwords and other access requirements for email accounts, social media accounts and other communication channels.

CFMEU national secretary Zach Smith (right) enters the Federal Court on Tuesday with his lawyer Josh Bornstein.Credit: Eamon Gallagher

It argues that the Tasmanian/Victorian, NSW, Queensland and South Australian construction division branches “have ceased to function effectively and that there are no effective means under the rules of the CFMEU by which they can be enabled to function effectively”.

Smith, who became national secretary in March last year, has been leading the clean-up since the allegations were first published in July.

But the Fair Work Commission argues the steps taken by the union since the allegations were aired are “limited in nature”.

On Wednesday afternoon, Smith released a video on CFMEU social media saying he and the union were meeting the commission this week to seek advice.

“This is a significant proposal with broad implications for our union and our members, and as such, we have sought further advice from the commission to inform our response,” Smith said.

“As always, your organisers will be out there doing their job, making sure you’re represented in the workplace and you’re safe at work.”

The commission told the court that its actions were prompted by breaches of federal workplace laws by the CFMEU on more than 1500 occasions, and an additional 1100 contraventions by officeholders, employees, delegates and members since 2003.

In more than 200 proceedings, penalties against the union have totalled at least $24 million, and $4 million ordered against its office holders, employees, delegates and members.

The commission also says in the court documents that it has become aware, via reporting by this masthead, of serious allegations of criminal and other unlawful conduct by current and former officeholders, employees and other representatives.

The document singles out payments of more than $186,000 made by the Victorian branch to a commercial printing company in March 2023 with the description “in-kind donations for Diana Asmar’s HWU in-house election”.

The commission says of the payment: “It is not apparent which object of the CFMEU, as set out in its National Rules … is achieved by such transactions.”

The commission’s probe comes amid fallout from a series of reports published in this masthead that included allegations of criminal infiltration of the CFMEU, kickback offers and corruption.

Long-time Victorian CFMEU boss John Setka resigned in July after he and his union were repeatedly questioned about the allegations.

The months-long Building Bad investigation also showed underworld identities and bikie gang figures holding important roles on CFMEU sites, as well as senior officials allegedly taking bribes and officials engaging in intimidating behaviour.

The CFMEU has been contacted for comment.

Premier Jacinta Allan said on Wednesday that the latest revelations by this masthead of low-paid healthcare workers’ money being used on a “ghost printing” scheme were “deeply, deeply concerning”.

“These are allegations of criminal behaviour not acceptable anywhere,” Allan said. “It is incumbent upon all of us to take a stand when you see unlawful culture.”

The premier stopped short of calling on Asmar to resign her position as HWU secretary, but did say union bosses needed to treat their positions with respect.

Victorian Opposition Leader John Pesutto reiterated calls for a royal commission into union wrongdoing.
“Premier Allan claims to want to fix up the rotten culture in the CFMEU that’s affected taxpayer-funded building sites around Victoria, but has been unwilling to date to do one single thing that will remove bikie elements – and other organised criminal elements – from those major projects,” he said.

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