Female hand reaching for 50 Australian dollar bills in her jeans back pocket
Female hand reaching for 50 Australian dollar bills in her jeans back pocket

Unions taking cut from workers’ entitlement funds

UNIONS are taking a secret cut from a multimillion-dollar workers' entitlement fund, explosive documents reveal.

The hidden earnings are stuffing union coffers with hundreds of thousands of dollars a year.

But the windfall is leaving workers worse off, because it is leaving less money for redundancy and illness payments, and workers are unable to choose cheaper income protection.

Some union enterprise bargaining agreements require business to pay money into a fund for workers' entitlements. Unions choose the fund.

It can be revealed that an agreement between an entitlement fund and the Victorian branch of the Electrical Trades Union gives the ETU a shock 16 per cent cut from the cash companies are putting into the entitlement fund.

It does not say what the cut is for or what they money is spent on.


The ETU takes a 16 per cent cut from funds paid into an entitlement fund.
The ETU takes a 16 per cent cut from funds paid into an entitlement fund.


The document, exclusively obtained by The Courier-Mail, shows the entitlement fund chosen by the union is Protect, which has board directors from ETU and National Electrical and Communications Association.

The ETU did not comment.

Protect has almost 30,000 members and more than 1000 participating employers.

Attorney-General Christian Porter told The Courier-Mail the revelations underscored why new laws were being introduced into Parliament today to protect workers' money.

"We now have documents clearly demonstrating that unions have received financial benefit from Protect, which is supposed to look after money to pay worker entitlements,'' Mr Porter said.

Other union enterprise bargaining agreements reveal companies must pay 2 per cent of employee earnings into Protect.

The Maritime Union of Australia, which this month has held strikes in Brisbane, Sydney, Melbourne and Fremantle, is demanding DP World continue to pay 2 per cent of workers' earnings into Protect, even though the port operator has said it would give workers a 2 per cent pay increase and allow them to chose their own income protection insurance.

A spokesman for the MUA said it did not get a "commission under the current scheme".

The CFMMEU did not comment and referred questions to the MUA.

Mr Porter said the "MUA - part of the militant CFMMEU" - was pushing hard in enterprise agreement negotiations with DP World, which operates ports around Australia, for that company to pay 2 per cent of each of its workers' salaries for income insurance to Protect.


Attorney-General Christian Porter. Picture: Kym Smith
Attorney-General Christian Porter. Picture: Kym Smith


"Remarkably, when DP World tried to provide that 2 per cent direct to its workers - the MUA sought and secured orders preventing them from doing so," he said.

"The obvious question is, why do so many unions want employers to send money to Protect; the ETU arrangement suggests it is because there is something in it for those unions.

"It raises serious questions as to whether the CFMMEU is receiving a financial benefit from Protect through the MUA, in return for forcing such conditions on employers as we can now see has clearly occurred with the ETU.

"This is the sort of secret financial structure to achieve a benefit to unions and not workers that we see far too often from the most extreme militant union in Australia.

"It's this sort of behaviour that hampers the delivery of, and increases the cost of goods and services and adds to the cost of construction of key infrastructure - a cost that's ultimately a burden to taxpayers."

He said two key industrial relations Bills to be reintroduced today were designed to put integrity into unions and employer organisations.

"A specific point of the Bills is that they will provide transparency to funds which hold workers' money," Mr Porter said.

"At the very least, if there are multiple situations where millions of dollars of workers' money - which is supposed to pay for income protection insurance or workers' entitlements - is siphoned back to unions for no obvious benefit, that transaction should be open and transparent so workers know where their money is actually going."