High Court challenge stifles overhaul of rogue union, administrator warns

CFMEU administrator Mark Irving says a challenge by the union’s former leadership has frustrated his ability to get whistleblowers to come forward, as they fear ex-officials could be returned to power.

CFMEU administrator Mark Irving says High Court action is impeding his clean-up of the militant union. Picture: Alex Coppel

You can now listen to The Australian's articles. Give us your feedback.

You can now listen to The Australian's articles.

CFMEU administrator Mark Irving, KC, says a High Court challenge by the union’s former leadership has frustrated his ability to get whistleblowers to come forward, as they fear ex-officials could be returned to power.

In his first report to federal parliament, tabled on Tuesday, Mr Irving said the High Court action had also stymied the administration’s ability to recruit the best staff, and to get industry figures to back reform.

He said the administration had disrupted some corrupt business models operating in the construction industry. “The role of organised crime and outlaw motorcycle groups in the industry has been retarded but has also evolved,” he said.

“The removal of certain former leaders has interfered with established relationships and arrangements. The involvement of some bad faith actors has been the subject of investigation. Some have been referred to various law enforcement authorities. Much remains to be done.”

Mr Irving said the administration was pursuing its core function of rebuilding the CFMEU’s construction division into a strong, democratic, member-controlled, industrially proactive and effective union “enduringly free of corruption and criminal influence”.

“It has taken steps to ensure the union continues to serve its members, works to keep members safe, fights to protect and improve the working conditions and the lives of members,” he said.

“It has sought to address corruption and confront menacing conduct within the union and within the industry. It has done so in the shadow of an unresolved High Court challenge, which has impeded the prompt implementation of the strategic plans of the administration.”

Mr Irving said an effective whistleblowing procedure required participants to trust that the recipient of information would not use it to “further victimise the complainant”.

“Uncertainty about whether the former leadership is returning to power has, in some cases, impeded the administration in obtaining full and frank disclosures from complainants,” he said.

“Further, some important reforms in the sector involve retraining a range of persons within the union. To do so requires the building of capacity to deliver the training, establishing a structure by which training is provided, the development of programs, and the delivery of training to an audience receptive to training.

“In circumstances where the previous leadership could be reinstated as the result of the High Court proceedings, the engagement of the best new staff, reallocating resources and performing the necessary work has been stymied.

“Another example is ‘buy in’ of industry participants to reform. There is little incentive for employees, delegates, employers and employer peak bodies to fully commit to a reform agenda when some members of the former leadership have intimated that full collaboration with the administration may result in a further cycle of retaliation.”

Workplace Relations Minister Murray Watt said Mr Irving and his team were making good progress in cleaning up the CFMEU and ensuring its members were well represented.

“It was unsurprising that a High Court challenge was launched by disgruntled former leaders of the union, and we will await the decision of the court,” Senator Watt said. “We will continue to provide our full support to the administration as it performs its crucial and challenging task.”

Mr Irving said in the five years before the administration started, the CFMEU and its officers breached industrial laws on 1163 occasions and incurred $10,628,861 in penalties.

“This is in stark contrast with the nine other largest unions who, taken together, have been found to have breached industrial laws on 37 occasions during the same period,” he said. “The legal costs incurred by the CFMEU – all of which involve funds from members – in defending these proceedings over that period are monstrously large.

“Unlawful conduct and simply paying enormous penalties had become part of the business model of the union. This must end”.

Civil Contractors Federation chief executive Nicholas Proud said while the report confirmed progress had been made in restoring accountability and transparency, there was still a long path to reforming the industrial relations framework.

“The administration has provided a structured process for addressing misconduct, giving contractors and workers greater confidence to report unacceptable behaviour without fear of retaliation, and there has been a marked return of civility in the workplace,” he said.

“A challenge noted by the report is that the High Court challenge limits the works of the administration, but there is a confidence that a return to civility in the construction industry is inevitable, and the work must progress regardless of the decision.

“While the intervention in the CFMEU has been a critical step, it is clear that stronger oversight mechanisms and balanced industrial relations policies must be implemented to ensure that intimidation, coercion and unlawful tactics are not simply allowed to re-emerge once the administration ends.”