More than 20 CFMEU officials stood down after organised crime allegations

More than 20 members of the CFMEU – some with links to organised crime – have been stood down from the Victorian branch after allegations that criminal figures had infiltrated the union and construction projects.

Victorian Labor could also miss out on hundreds of thousands of dollars in fees while the union’s construction division is suspended from the party, having pocketed almost $700,000 in affiliation payments over the last five years, analysis by this masthead has found.

The CFMEU has faced allegations that organised crime figures had infiltrated the union.Credit: Eddie Jim

While the union waits to learn whether an independent administrator could be appointed, this masthead has confirmed that the state branch has already moved in response to serious allegations that organised crime figures had infiltrated their organisation and Victorian projects.

Delegates and officials have been called into meetings this week and stood down. Six sources in Labor and the union movement, speaking anonymously to avoid repercussions, put the number at more than 20.

The decisions followed publication of a months-long investigation by this masthead, The Australian Financial Review and 60 Minutes and days of reporting that led to the appointment of an administrator to the national branch and suspension of the Victorian branch from the Labor Party.

One source said Derek Christopher, expected to succeed John Setka as the union’s next state secretary, had played a role in the process of removing them from official positions.

Another said the move would also effectively block these individuals from government work sites because they no longer had authorisation to attend construction jobs.

The CFMEU was contacted for comment.

Setka preemptively resigned from the union last Friday night, and the disgraced leader has also taken a leave of absence from a worker entitlement scheme, Incolink.

The fund, which manages more than $1 billion in assets, confirmed CFMEU national secretary Zach Smith would temporarily replace Setka as a board director.

Incolink is the country’s largest provider of severance benefits to building and construction workers, having paid out more than $360 million in redundancy payments in the past financial year.

Its board includes union and industry figures, who are appointed by the fund’s shareholders. Setka, nominated by the CFMEU, has been a director since 2022 and his future on the board is in the hands of the construction union.

“Incolink is an industry partnership comprising equal board representation between unions and employers,” a spokesman said. “This is the model which has allowed it to respond to industry challenges such as COVID-19, through collaboration between leadership.”

The Incolink spokesman said a meeting would be scheduled for shareholders, and announced former Victorian Labor minister Jill Hennessy would join the board as an independent director.

An analysis of donations and Victorian Labor’s last five annual returns to the electoral commission has also revealed the construction and general division of the CFMEU has provided $699,793 to the state branch of the party since September 2019.

Almost all of that was in affiliation fees, which have been reported to June 2023, and which were as high as $214,003 in 2021-22.

Any affiliation fees paid during the 2023-24 financial year are yet to be publicly disclosed. Such payments are exempt from donation caps but can only be used for the party’s administrative purposes, not for campaigning.

Labor will not accept affiliation fees or any donations from the barred division during its suspension, meaning the party would likely lose hundreds of thousands of dollars as a result.

Premier Jacinta Allan on Friday said she had taken immediate action “to address this rotten culture and pull it out at its roots”.

In one example exposed this week, crime figure Joel Leavitt was revealed to have driven himself to the hospital in a car given to him to conduct workers’ safety checks after being shot at the Rebels bikie clubhouse. He was employed on the taxpayer-funded Hurstbridge rail line upgrade, earning an estimated $250,000 as a CFMEU health and safety official.

One Labor source said there were concerns the union would eventually begin walking off job sites if members felt federal and state government intervention had gone too far.

But they said this would depend on whether key leaders, such as Christopher, were asked to vacate their roles as part of the administration process.

The government was due to release the terms of reference for an independent review that could strengthen the powers of state government agencies working in construction.

Allan said she would release the details this week but was yet to do so by 5pm Friday.

“Those terms of reference for that review will be released very, very soon,” she told regional journalists in Bendigo earlier on Friday.

Allan wouldn’t comment on personal text messages, which were also revealed by The Age on Friday, between members of her party room and Setka, offering the former union leader support in 2019 when he was charged with domestic violence offences.

“What I can say is we have zero tolerance for this sort of behaviour, any bullying behaviour, unacceptable behaviour. John Setka has resigned, as he should, from his position,” Allan said.

“What I will say, and it is my expectation, it is absolutely my expectation, that it doesn’t matter which political party you represent in the Victorian parliament, you demonstrate respect for women, you stand together, shoulder to shoulder, to stamp out violence against women.”

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