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Tuesday, 14 February 2017
Page: 964


Mr LEESER (Berowra) (16:31): I rise to support this bill. The Building and Construction Industry (Improving Productivity) Amendment Bill 2017 makes a welcome adjustment to the Building and Construction Industry (Improving Productivity) Act 2016. The ABCC act and the building code contained a two-year transition period which delayed the requirement, under the building code, for building and construction companies to have code-compliant enterprise agreements before they could tender for Commonwealth funded work. This transition period allowed construction companies to continue to use non-code-compliant enterprise agreements made before 2 December 2016.

This bill does two things. It decreases the transition period included in the act from two years to nine months. This will see the new code come into practice by the end of the year. The bill will also prohibit companies with non-code-compliant agreements from being awarded Commonwealth-funded building work after the commencement date of the bill.

These changes are directed at the massive union pressure placed on building companies to sign non-code-compliant agreements that contain non-productive and discriminatory terms. There is evidence that unions are already trying to dodge the code. Just days after the code was released, the CFMEU shut down 13 sites operated by Kane Constructions in Victoria. Kane is a construction company that has resisted intense coercion from the CFMEU to sign non-code-compliant enterprise agreements.

These changes are a welcome tightening of the legislation, to encourage and reward companies who comply with the new building code. They remove any unfair advantage that may have been paid to construction companies unable to hold out against the standover tactics of the CFMEU. They create a level playing field across the building industry.

In supporting this bill, I, unlike the member for Gorton, would like to commend Senator Hinch for listening to the construction industry in Victoria, for being responsive and for his appreciation of what the government is trying to achieve through the ABCC. As Senator Hinch said:

… the legislation was killing them—

the building and construction companies, he meant. It doesn't get much clearer than that.

The re-establishment of the Australian Building and Construction Commission last year was a signature achievement of the coalition. Despite the best efforts of unions and the Labor Party, the ABCC is back. According to the Australian Bureau of Statistics, nearly half, 42 per cent, of all working days lost to industrial disputes are in the construction industry. In September 2016, the rate of industrial disputes in the construction industry was nearly six times the Australian average. These disputes are estimated to add 30 per cent to the cost of infrastructure. As of 30 January 2017, there were 110 CFMEU officials before the courts, which in recent years have imposed fines of more than $8 million on the union. When the previous ABCC existed, the performance of the building and construction industry improved. Productivity improved by 30 per cent. Disputes fell from five times the all-industries average to double the average. Under the Rudd-Gillard-Rudd government, the ABCC was abolished by the then employment minister, Bill Shorten, at the behest of the CFMEU. Standards of behaviour in the building industry deteriorated markedly. Violent disputes became more common. Thuggery and disregard for the law became commonplace. Productivity flatlined.

The re-establishment of the ABCC last year put back in place a regulator with strong and effective powers. It established a commission with the power to monitor compliance with the law by the building and construction industry. The ABCC will be able to take enforcement action and promote appropriate standards of conduct across the industry. The commission will have the power to eliminate coercion and discrimination in the industry. It will take action against standover tactics and the strongarming of builders and workers who are trying to do the right thing. It will enforce better levels of governance across the industry by making it an offence to intentionally hinder or obstruct an authorised officer seeking information or documents.

There is no question of the need for the ABCC. Just like the Cole royal commission laid bare the truth of the building and construction industry in the early 2000s, leading to the original establishment of the ABCC, the Royal Commission into Trade Union Governance and Corruption, the Heydon royal commission, showed just how low Australia's unions had sunk, and the CFMEU and the AWU were among the worst of the lot.

The report of the 2015 Royal Commission into Trade Union Governance and Corruption is a great read. It is a real page-turner. Just when you think it cannot get worse, just when you think that you must have reached the peak of union corruption and failure of governance, there is another example that is even more outrageous or unbelievable.

Commissioner Heydon did a fantastic job in very difficult circumstances, and I commend him for his patience, his fortitude and his significant efforts in putting together a comprehensive report. Commissioner Heydon is one of the outstanding lawyers of his generation. The personal attacks from those opposite and from the trade union movement were unprecedented and outrageous, particularly for someone who, like his celebrated father, Sir Peter Heydon—the public servant who was most responsible for the ending of the White Australia policy—has given so much service to his country.

The report is not an insignificant achievement when you consider what he was up against. There was perjury—much perjury. Some union officials brazenly admitted to it and said they would plead guilty to charges of perjury. A huge amount of the testimony given in hearings was false to the knowledge of the witnesses. There was destruction of documents, most blatantly by the CFMEU. The CFMEU in Queensland caused a number of tonnes—tonnes—of documents to be removed from the CFMEU's Brisbane office and disposed of on the same day that the CFMEU received a notice to produce from the royal commission. Despite this obstructionist behaviour, the commission found plenty of evidence of trade union corruption and the complete failure of anything approaching governance.

Commissioner Heydon found widespread misconduct by six unions across every state and territory in Australia, except for the Northern Territory. He found financial misconduct. He found breaches of legal duty. He found misuse of union funds for personal gain and purposes. He found misrepresentation of membership numbers. He found misconduct on building sites. He found abuse of process. He found blackmail. He found death threats and bribery. Commissioner Heydon found:

This conduct has taken place among a wide variety of unions and industries. Those responsible have ranged in seniority from the most junior levels to the most senior ... Of course what has been described is not universal. It may not even be typical. But you can look at any area of Australia. You can look at any unionised industry. You can look at any type of industrial union. You can select any period of time. You can take any rank of officeholder … You can search for any type of misbehaviour. You will find rich examples over the last 23 years in the Australian … union movement.

Again, he said:

The misconduct exhibits great variety. It is widespread. It is deep-seated.

The Labor Party argues that the ABCC is an unfair and unwarranted imposition on trade unions. In a civilised society, you should not need a watchdog. But, given the findings of Heydon royal commission, how can you possibly consider the building and construction industry to be civilised? How can you possibly let these trade unions continue to act without oversight?

As I said before, the report of the royal commission makes for gripping reading. Here are some examples:

At a blockade of a Grocon site by the CFMEU a driver of a minibus, who happened to be suffering from cancer, attempted to drive out of the blockaded area. He described how CFMEU members surrounded his van, yelling abuse and punching the windscreen. One of them was John Setka, then Assistant State Secretary, who was found by Tracey J to have used foul and abusive language, to have punched the windscreen, and to have shouted: ‘I hope you die of … cancer’.

This is not civilised behaviour.

Last April, a CFMEU official was found guilty of attempting to intimidate a government official on the Barangaroo site in Sydney. While blockading the site, he was alleged to have abused workers attempting to go to work, calling them 'scum' and 'dogs'. He was found to have called a government inspector a 'grub' and abused him with language too foul to use in this place. The same CFMEU official was found guilty on two charges of threatening and intimidating two government inspectors on the Sunshine Coast and intimidating a further inspector at the Queensland University of Technology, including by attempting to punch him. These are not civilised people. Perhaps the most well-known instance was in Queensland. When told he was trespassing on a Grocon building site, a CFMEU official threatened a Grocon safety adviser, saying, 'You know what, I know your phone number. I know where you live.' I want to be clear that these are not idle threats. The royal commission heard evidence from one project manager at a licensed builder that he was beaten up by two CFMEU officials when he refused to pull money out of the business to make unauthorised payments to the union. They beat him so badly that they perforated both his eardrums. He required hospital treatment. This is not an acceptable work environment. This is not acceptable in Australia in 2017.

I return to the Royal Commission. Numerous officials were found to have misused trade union funds for their personal gain. Remember, these are people who are supposedly representing the otherwise unrepresented workers and who are meant to be delivering a public good in terms of getting the best outcome for their workers; but, instead, what did they do? They took membership dues and spent them on themselves. A former lead organiser for the CFMEU in the Australian Capital Territory conceded during hearings in Canberra that he had personally received $100,000 in secret payments from employers. A former president of the CFMEU in Queensland received around $150,000 worth of free work on his home, arranged by a senior employee of a major building company, with the knowledge of his superior. Both the incoming and the outgoing secretary of the Western Australian branch of the TWU depleted union funds by over $600,000 to spend on the unauthorised purchase of two luxury four-wheel drive vehicles and an unauthorised, generous redundancy payment for the outgoing secretary. In the notorious Health Services Union, Kathy Jackson, Michael Williamson and Craig Thomson used union funds for their own purposes, and both Williamson and Thomson have been convicted in relation to their crimes.

But, as we all know, personal use of union funds was not where it stopped. Unions negotiated sweetheart payments from employers, trashing the interests of their members for paltry financial gain into undisclosed fighting funds. An organiser in the CFMEU in New South Wales received $2,500 per week in secret and possibly unlawful cash payments. A company operating a mushroom farm in Victoria agreed to pay the AWU $4,000 a month for a number of months in exchange for industrial peace. The AWU in Victoria entered into an agreement with Thiess John Holland, where the AWU received $110,000 per year for three years, disguised by a series of false invoices. The AWU in Victoria and a large cleaning company, Cleanevent, agreed to extend their enterprise agreement without any consultation with workers. This saved the company $2 million a year. And what did the AWU get in return? It got $25,000 per year and 100 bogus union members. What a deal! What a complete perversion of the role of a trade union. What a paltry price for such a sell-out. And who was the hard-headed, genius negotiator of this deal? The Leader of the Opposition! Who knows where he would take our country with that kind of capability behind him.

It is no wonder that Senator Hinch has been approached by building and construction companies in his home state of Victoria, keen to see compliance with the new code of conduct come into force as soon as possible. Victoria has borne witness to some of the very worst behaviour of the CFMEU. Last June, the Herald Sun identified a paid CFMEU official attending a bikie protest, which was led by a union representative in Rebels colours. That union representative was using a megaphone covered in CFMEU stickers. The relationship between the CFMEU and bikie gangs was there for all to see.

In his statement to the Royal Commission on Trade Union Governance and Corruption, Victoria Police Assistant Commissioner, Stephen Fontana, confirmed: 'Victoria Police intelligence indicates that criminal activity is undertaken by trade union officials directly, and by organised crime figures or groups on behalf of trade union officials.' He went on to say, 'The criminal activity of which Victoria Police is concerned is generally comprised of corruption, drug trade, blackmail and extortion. Corruption takes the form of secret commissions and preferential tendering.' And that's not all. He went on to say, 'Intelligence indicates that trade union officials use Outlaw Motorcycle Gangs to engage in activity on their behalf and that [these gangs] often commit serious crime to execute these activities. Specifically, trade unions use [gang] members as "hired muscle" for debt collection, with "standover tactics used to intimidate victims".' This kind of behaviour is outrageous. It is holding our building and construction industry to ransom. We cannot have trade unions working hand in glove with outlawed criminal gangs to put a halt to legitimate business. We cannot have the jobs of everyday Australians put at risk so that groups of criminals might profit from illegal activities. We cannot have a lawless trade union running rampant over an industry.

In conclusion, the protections offered by the ABCC are real and the need for those protections is real. The Royal Commission into Trade Union Governance and Corruption proved just how badly the trade union movement can fail its members—hard working men and women who rely on unions to represent them and deliver reasonable and fair working conditions. The unions involved in the building and construction industry, the CFMEU in particular, are among the worst of the lot. There is a distinct pattern of behaviour where the union operates to its own advantage and to the personal advantage of its office bearers and representatives. As Commissioner Heydon reported: 'It is a picture of the union concerned not with its role as the instrument through which to protect the public interest of its members but with self-interest. Its primary interest is in leading the group of its officials as a self-perpetuating institution. It is an institution more concerned with gathering members than servicing them.'

The ABCC will bring standards back to Australia's building sites. It will increase productivity, improve the safety of workers and hold the CFMEU to account. The amendment put forward in this bill today will expedite these standards, making them operational by the end of the year. For that reason, I commend the bill to this House.