advertising
Union officials may face same scrutiny as company directors
PUBLISHED: 09 APR 2014 08:37:00 | UPDATED: 10 APR 20 2014 07:55:16
GIFT ARTICLE: 100
Outside the first hearing of the union royal commission on Wednesday, Bob Kernohan and Kathy Jackson. Photo: Louise Kennerley JOANNA MATHER AND MATHEW THEW DUNCKLEY
The royal commission into union corruption may recommend union officials face the same scrutiny as company directors, the government-appointed government appointed counsel assisting has told a preliminary hearing in Sydney. But the commissions terms of reference do not assume assume the role of unions in society should be curbed to the point of insignificance, former High Court Justice Dyson Heydon said. In his first statement as commissioner, Mr Heydon on Wednesday said the terms of reference set by the federal government do not t assume that it is desirable to abolish trade unions.
Instead, they assume it is worth inquiring into how well and how lawfully that role is performed, he said. The inquiry will focus on so-called slush funds. It is required to complete its work by December 31. The terms of reference describe slush funds as separate entities established by employee associations for purportedly industrial purposes or member welfare purposes. The accusation is that money collected from union members for these purposes has been wrongfully used, including in the alleged case involving union boss Bruce Wilson, Julia Gillards former boyfriend. Counsel assisting Jeremy Stoljar, SC, said the commission could find that union officials needed a similar level of scrutiny to company directors. The law of this country recognises that an officer of a company owes a range of legal ... [and] statutory duties, he said. Perhaps a union officials obligations should be even more onerous. Counsel assisting is appointed by the federal Attorney-General, in this case George Brandis. Speaking to a packed room which included whistleblowers Kathy Jackson and Bob Kernohan, Mr Heydon outlined the requirements of the Royal Commissions Act of 1902 and associated penalties for failure to comply. He said the commission would rely on a combination of oral testimony, historical documents and circumstantial reasoning to fulfil its task, but did not name a date for the next hearing or give details of the witnesses to be called. Mr Stoljar in his opening statement said there were claims unions had used slush funds to pay for electioneering or other purposes. However, no honest working man or woman has anything to fear from this commission. Mr Stoljar said greater scrutiny may be needed on union officials who deal with members money. After all, a shareholder in a company listed on the stock exchange can always sell his or her shares and move on. It is not so easy to switch unions, he said. Also, a listed company usually has large or institutional shareholders who keep close watch on the activities of the board. Union officials may not be under this degree of scrutiny. If the allegations [which are] the subject of this commission prove to be correct the current level of scrutiny may be inadequate. The opening statements came after Employment Minister Eric Abetz said honest unions had nothing to fear.
Josh Bornstein, a principal at Maurice Blackburn, which is providing legal advice to several unions, accused Senator Abetz of rank hypocrisy for describing unions as containing sophisticated and systemic corruption before the commission had begun but refusing to make any such judgment on the conduct of his party colleague senator Arthur Sinodinos. Mr Bornstein said the public cases of corruption, such as at the Health Services Union, were isolated and should not be used to tar the entire movement. ACTU assistant secretary Tim Lyons said there was an enormous and unexplained gap in the approach of Mr Heydon and that of Justice Neville Owens at the HIH royal commissoin. A previous royal commission into wrongdoing in a particular industry made it clear that the rules of natural justice would be scrupulously followed, including people to be allowed to rebut allegations, and the commissioner this morning felt no such obligation to make a similar observation, he said. It appears there is one rule for corporate Australia and another for unions. An emotional Bob Kernohan, a former Australian Workers Union Victoria president who has been raising fraud allegations for 18 years said: Its a disgrace really that its taken so long. Mr Kernohan alleges former prime minister Ms Gillard was aware of a slush fund created by her boyfriend at the time something she has always denied. Outside the hearing, Health Services Union national secretary and whistleblower Kathy Jackson said stronger unions were likely to result from the process. She gave evidence against former HSU official and federal politician Craig Thomson, who is appealing a jail sentence for fraud. More revelations would certainly emerge about her own HSU, Ms Jackson said, adding she did not believe the commission would be able to complete its work in under a year. I think at the end of the day well see stronger unions, she said. Unions [whose] members can be confident that they are doing the right thing by their membership. But also better regulated unions and fairer unions ... not faceless men doing backroom deals to get into Parliament. Mr Stojar urged rank-and-file union members to come forward with information that might be helpful to the commission. The terms of reference assume that the members who fund the union through their hard-earned wages are entitled to know that those who spend their money will do so with their interests at heart, he said. The rules of natural justice would be applied and, on the other side of the ledger, any recipients of corrupt funds would also be investigated. To union members I say this: You dont help anyone by keeping wrongful conduct under wraps.
