Former communist to lead clean-up of Setka’s old CFMEU branch

Former communist and long-time academics’ union boss Grahame McCulloch will take over the Victorian CFMEU branch once controlled by John Setka after the government tipped the scandal-plagued organisation into administration, while the Coalition demands to know why national secretary Zach Smith has kept his job.

Attorney-General Mark Dreyfus on Friday installed barrister Mark Irving, KC, to run the CFMEU nationally, pushing out almost 300 of the union’s leaders, including its powerful NSW secretary Darren Greenfield and Setka protege Derek Christopher.

CFMEU national secretary Zach Smith (right) will keep his job.Credit: Eamon Gallagher

Smith, who fronted the union’s efforts to stave off administration and praised Setka after his resignation last month, will stay on.

The administration follows a joint investigation by this masthead, The Australian Financial Review and 60 Minutes that aired allegations of corruption, coercion and bikie infiltration within the union, which in effect sets the rules for Australia’s construction sector.

Coalition workplace relations spokeswoman Michaelia Cash said the government should explain why Smith had kept his job, given “how difficult it will be to change the national culture of an organisation if the previous head of it is still there”.

No allegations of wrongdoing have been made against Smith, who was contacted for comment. As secretary, Smith commissioned a barrister to investigate the allegations and pushed out bikie-linked delegates.

Union sources who did not have clearance to speak on the record said McCulloch, the founding general secretary of the left-wing National Tertiary Education Union, will lead the effort to clean up the CFMEU’s Victorian branch.

McCulloch, who did not respond to a request for comment, was a Communist Party member in the 1980s, which could enhance his credibility with militant CFMEU members, but has held senior Labor and superannuation roles in the years since leaving the university union in 2018.

Surviving officials such as Smith, West Australian head Mick Buchan and lead ACT official Michael Hiscox will be forced to co-operate with the administrator, but those leaving will have to surrender work phones, credit cards, laptops and cars to Irving.

One key decision for Irving is which CFMEU employees, who include high-profile City of Melbourne councillor Elizabeth O’Sullivan-Myles, will stay on. Those roles are distinct from the 292 positions, mostly unpaid, that have already been vacated.

O’Sullivan-Myles, who is married to fellow CFMEU figure Joey Myles, declined to comment. There are no allegations against her.

Irving will also have to decide what happens to the union’s enterprise agreements.

Irving assured union members of his labour credentials on Friday, writing in a letter seen by this masthead that he had been a member of the Australian Services Union for more than 30 years.

“I firstly want to say that the CFMEU’s record of successful struggle to keep workers safe is unequalled in Australia and you are justly proud of the union’s history of protecting and improving wages and conditions,” Irving wrote. “The administration will come and go, but the work of the CFMEU must endure.”

Former university union general secretary Grahame McCulloch will lead the Victorian CFMEU branch.Credit: Josh Robenstone

But he promised to address corruption, fraud and organised crime in the industry.

“I acknowledge that the coming period will not be easy because it is also my job to ensure that the criminal elements that have infiltrated some parts of the union and the industry be rooted out,” Irving wrote.

He said some officials would be removed but that Smith would retain his position, without explaining why.

In a statement on Friday, Irving said the union would not “engage in party politics during the administration and will not make donations to any party, seek to exercise any influence through representations at political conferences, or promote any candidates of any faction or party”.

The union’s NSW branch denounced the government’s decision to vacate officials’ roles, with its leaders saying they had read about the “attack” in the media before being contacted.

“These officials are hardworking, committed trade union leaders, whose only motivation was to further the conditions of thousands of CFMEU members,” the statement from Greenfield and his colleagues said.

“This entire farce was born through a baseless media and government stitch-up. The lack of due process and basic democratic rights from this government is disgusting and simply un-Australian.”

Irving’s appointment begins immediately but could be tested by the union in the courts. Several allied unions, including the Electrical Trades Union and Maritime Union, have said they are likely to donate to any challenge.

Workplace Relations Minister Murray Watt, who has the power to put the union into administration under laws passed by parliament this week, delegated that decision to Dreyfus. That avoids the perception of bias because Dreyfus has not been publicly criticising the union, unlike Watt.

On Wednesday, Watt said the legislation had been designed “to be as robust as possible to withstand any future legal challenges”.

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