Fair Work launches 42 probes into CFMEU coercion, corruption

Federal authorities have launched more than 40 new investigations into CFMEU officials accused of coercion and corruption, as union and industry bosses meet government ministers on Wednesday to agree on a new agenda to clean up the construction sector.

The plan is to crack down on bad behaviour as well as improve efficiency and fix the sector’s chronic labour shortages, amid fears employers cannot find the carpenters, electricians and plumbers they need to build more homes.

Employment Minister Murray Watt will convene the meeting with industry executives and union officials in the hope of meeting a national target to build 1.2 million new homes over the next five years.

The meeting comes after Opposition housing spokesman Michael Sukkar dismissed the Labor target and said a Coalition government would not keep the target if it formed government after the next election, escalating the policy contest on housing.

Housing Minister Clare O’Neil attacked Sukkar for planning to scrap the target.

“It’s that kind of low ambition that got us to where we are right now,” she said.

There are more than 40 ongoing investigations into CFMEU officials.Credit: James Brickwood

“And that is in a housing crisis where this is affecting the lives of millions of people in our country and the Liberals want us to lower our ambitions.”

With all sides blaming corruption for slowing down projects and driving up costs, the Fair Work Ombudsman confirmed it had launched 42 further investigations into alleged illegal conduct in the disgraced Construction and General Division of the CFMEU.

The cases include alleged threats to coerce employees to vote in a certain way in workplace decisions, with the ombudsman preparing to interview witnesses and issue notices to produce documents to gather more evidence.

The investigations act on a referral from the federal government in July in response to the Building Bad investigation by this masthead, The Australian Financial Review and 60 Minutes exposing alleged corruption and links to bikie gangs in the powerful construction union.

Industry executives and union officials have been called to the meeting with Watt and other ministers in Melbourne to negotiate the new industry agenda after years of concern about high costs and low productivity.

Australian Constructors Association chief Jon Davies said he was hoping for an agreement to fix chronic problems including low productivity and the failure of many building firms.

“The industry accounts for 26 per cent of all insolvencies, so it’s well over-represented in that,” he said. “And we are less productive as an industry today than we were 30 years ago. That’s a pretty damning set of statistics.”

The agenda includes improving the sustainability of the industry when employers cannot find enough workers to meet demand in housing construction, separate from the strong demand for workers on major projects such as the Metro Tunnel in Melbourne and the next phase of the Sydney Metro.

The construction sector added almost 41,000 workers last financial year and now employs about 1.3 million people in building work, according to Deloitte Access Economics, but the job gains are expected to slow as state governments scale back spending.

“A key constraint is skilled labour,” Deloitte economist David Rumbens said.

“It is not as bad as it was two years ago because vacancies have come down. But it’s still a constraint, particularly if you are talking about ramping up construction activity.

“Our forecasts suggest the 1.2 million target won’t be met. It would be closer to 1 million, and that’s still a pick up on the current level.”

While the government is attempting new measures to meet the housing target, Sukkar said on Tuesday the Coalition did not believe it was possible.

“We will build as many homes as we possibly can,” Sukkar told ABC Radio National. “What we won’t do is lie to Australians and create the impression that we’re going to build more homes than are going to be delivered.”

Watt said the Fair Work Ombudsman’s investigations showed there was progress in cleaning up the industry.

“The FWO’s report complements the ongoing work being done by the administrator of the union. I am concerned about the ongoing reluctance on the part of complainants to come forward, and we are considering what further steps can be taken to address this,” he told this masthead.

“Importantly these investigations cover the whole industry because the issues at the core of the construction sector aren’t limited to the union. Employers who have done the wrong thing also need to be held to account.”

Investigations will involve interviewing witnesses, conducting site visits and issuing notices to produce records or documents.

Of the 42 investigations, it includes looking into alleged threats to coerce employees to vote a certain way in the agreement-making process, coercing employers into entering into an enterprise agreement with the CFMEU, requirements that certain individuals be employed in certain roles or non-compliance with disclosure requirements by employers or other obligations.

A significant proportion of the information received by the FWO has involved alleged coercive behaviour by the CFMEU and its officials.

The administration, led by Mark Irving KC, is separately investigating union members and its associates. A spokesperson for the administration declined to comment.

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