Much of Australia’s construction union is likely to be placed into administration after the nation’s regulator for workplace relations moved to place the majority of the union’s construction divisions and divisional branches into administration.

Last Friday, Fair Work Commission General Manager Murray Furlong initiated proceedings in the Federal Court of Australia to appoint employment and anti-discrimination lawyer Mark Irving QC as independent administrator to for the Construction and General Division of the Construction, Forestry and Maritime Employees Association (CFMEU).

The move follows allegations concerning thuggery, intimidation, organised crime, corruption and collusion with bikie gangs which have been aired on 60 Minutes and in Nine Newspaper.

If granted by the courts, the administration will cover the divisional and executive officers in the Victoria-Tasmania, New South Wales, Queensland Northern Territory and South Australian divisions and divisional branches.

It will not impact the ACT and Western Australia at this stage – through these branches could also be brought under the scheme at a later date upon further application to the court.

Should he be appointed, Irving will be given effective control of the aforementioned union branches and offices and will be tasked with ensuring that the union functions effectively according to both the legislative framework which it operates and the lawful objectives of the CFMEU.

His wide-ranging powers (in respect of the relevant divisions and branches) will include hiring and firing union officials and staff, taking possession of all union property and credit cards, establishing and implementing policies, maintaining member registers, preparing financial accounts and bringing proceedings to recover funds, impose penalties and award compensation.

His will be required to ensure that union members continue to enjoy representation and that the division and divisional branches operate in accordance with their legal objectives.

The administration of each division or branch will end only after Irvine certifies that it is functioning effectively and the Fair Work Commission General Manager agrees with this assessment.

Before this happens, an independent audit of the division or divisional branches financial affairs will need to be conducted.

To support the scheme’s integrity, the application to the Federal Court also seeks the appointment of KordaMentha Pty Ltd to undertake a special purpose audit and prepare a report into the financial position and financial risks relating to the division and branches in administration.

Employer groups broadly welcomed the latest moves.

Whilst it expressed disappointment that the ACT and WA branch had been excluded, Master Builders Australia said in a statement that the application represented ‘an important first step towards tackling criminality and the poor culture within the sector’.

Still, Master Builders said that more needs to be done.

This includes ensuring that strong protections are in place for people wishing to come forward with evidence, information, or materials to support the various investigations and inquiries underway as well as the establishment of a single body to coordinate the various inquiries which are underway.

Longer term, it called for a comprehensive and coordinated approach to address the poor culture which has become ingrained across some parts of the industry.

This would require the creation of a specific and dedicated industry regulator which is given adequate resources and powers – something close to the former Australian Building and Construction Commission that was scrapped by the Federal Labor Government in 2022.

“We all, whether as employers, workers or union members, deserve to work in an industry that is lawful, safe and free from corruption, coercion, bullying and intimidation,” the MBA statement read.

“Everyone in building and construction recognises the important role that unions play in workplaces but it’s clear some within the CFMEU have lost their way.

“This is a unique opportunity for governments of all levels to ensure that the building and construction industry is lawful, modern, safe, and productive now and in the future.”

Australian Industry Group CEO Innes Willox also welcomed the application to appoint an administrator but said that Commonwealth and state government need to co-ordinate on broader legislative reforms to address the current deficiencies in workplace law that enabled this behaviour to occur.

“The appointment of an administrator with significant powers is an important first step to address the scandalous behaviour of the CFMEU as well as the entrenched problems this has created for the construction industry,” Willox says.

The CFMEU did not respond to requests for comment.

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