Union corruption rips off workers

November 26, 2013
Michael Williamson is facing a prison sentence for defrauding the Health Services Union of $5.9 million of its members’ funds.

The formation of the Labor Party — created as part of a global movement to form mass workers’ parties in the 1890’s — differed markedly from the formation of social democratic parties in mainland Europe. The tendency in these countries was for the formation of workers’ political parties to precede the formation of a mass union movement which the parties then encouraged.

In Australia, as in New Zealand and Britain, it was the other way around — the union movement organised the Labor Party. It was expected that unions would be able to influence party policy, particularly when in government, to a greater degree than was possible in European social democratic parties.

These great expectations have always ended in even greater disappointment.

Since Bob Hawke’s transition from Australian Council of Trade Unions (ACTU) president to prime minister, there has been a culture of leadership ambition in the union movement that is part of a deliberately chosen career path to parliament.

Even more disturbing is the emergence of a career path continuum that now extends, post-politics, to lobbyist and company director.

Four years ago a survey of lobbyists in Australia showed that of the 23 key lobbyists in the five mainland states, 17 had Labor connections. Former ACTU president Martin Ferguson, who went on to become resources minister, retired from parliament at the last election. He is now group executive for Seven Group’s Caterpillar operations, the world’s leading manufacturer of construction and mining equipment.

It is in this context that we can understand the mess that continues to unfold in the Health Services Union (HSU), whose membership includes some of the lowest-paid workers in the public and private hospital system.

At the HSU national conference in 2010, General Secretary Michael Williamson reported, among other offices he held, he was president of the Labor Party, an executive member of the ACTU, vice-president of both Unions NSW and the ALP NSW branch and a director of private radiology company Imaging Partners Online and inhouse union IT company United Edge.

What he did not tell them was that at IPO — an appointment facilitated by former NSW Labor minister Craig Knowles — he was being paid by a company that sold millions of dollars of radiology services to hospitals and promoted the privatisation of services his members provided.

At the time, Williams was receiving a salary of $513,294 from the union and $236,260 from the various board seats he held, which totalled a yearly income of $749,554. He is now facing the prospect of a prison sentence for his role in defrauding the HSU of $5.9 million of its members’ funds.

The Tony Abbott government announced on November 16 that new restrictions on unions entering workplaces and limits on their ability to bargain for wages and conditions will be introduced by early next year. Other restrictive laws will follow.

This prompted ACTU secretary Dave Oliver to complain of “the government doing the bidding of big business at the expense of Australian workers.” As opposed to Williamson and the previous Labor government’s Fair Work Act that replicated provisions already found to have breached International Labour Organization conventions?

While there are some notable and honourable exceptions, the union movement’s leadership seems possessed of a peculiar view that all can only be for the best when Labor is in government.

But workers know that is not the case. Like the workers at Cochlear who have spent the last five years trying to get a decent enterprise agreement.

Union affiliation to Labor should be a matter for union members to decide. Blanket affiliation of individual unionists who have no say in the matter is an arrogant disdain of members’ rights.

This could not be said of the Electrical Trade Union in Victoria. In 2010 they organised a membership ballot on ALP affiliation and 86% voted against it. This expression of rank-and-file democracy is what union careerists and opportunists are afraid of, no matter what damage they cause to unionism.

And the damage is considerable. Some 87% of workers in the private sector are not members of a union. While there are 1.8 million union members in the workforce there are also 1.5 million who have previously been members but have declined to renew their memberships.

At the same time, the number of union officials has risen almost in proportion to the decline in membership. The procession of ALP politicians appearing before the NSW Independent Comission Against Corruption continues to remind us of the corruption that comes courtesy of a factional system rotten to the core.

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