Unions could be deregistered for being “dysfunctional” and union officials banned under a new wave of industrial laws.
The legislation come as the coalition turns up the heat on Labor over its links to the Construction Forestry Mining and Energy Union.
Leader of the House Christopher Pyne told parliament on Thursday the bill, promised during the 2016 election campaign, would be introduced in the Spring sittings.
Under the changes, a court could ban a union official from holding office where that official repeatedly breaks the law.
The Heydon royal commission recommended the ban apply to officials who have been convicted of an offence attracting a jail term of five years or more.
The disqualifying period would be up to the court.
If the banned official continues to hold office they could face fines or two years in jail.
As well, the court could place unions in administration or deregister them if they "become dysfunctional or are no longer serving the interests of their members".
CFMEU Victorian state secretary John Setka told a Melbourne rally on Tuesday the union was going to expose Australian Building and Construction Commission inspectors and make their children "ashamed of who their parents are".
"Let me give a dire warning to them ABCC inspectors, be careful what you do. You're out there to destroy our lives," he warned.
Federal Employment Minister Michaelia Cash has referred the CFMEU boss to federal police and Victoria Police.
Prime Minister Malcolm Turnbull told parliament Labor leader Bill Shorten had given "the limpest of responses" to Mr Setka's comments.
"He wants to put those thugs above the law," Mr Turnbull said.
Mr Shorten, who has repudiated the union leader's comments, said he would not listen to a lecture from the government on respect for the rule of law given that three ministers were before the courts.
"Respect for law - pull the other one," he told parliament.