Bill Shorten needs to demonstrate independence from the unions

Bill Shorten can heave a sigh of relief at the statement from the royal commission into union corruption that he didn’t do anything illegal in the activities it examined in his Australian Workers' Union past.

If Jeremy Stoljar, SC, counsel assisting the commission, had recommended in his Friday submissions that the commission find Shorten might have breached the law, that surely would have killed his leadership.

Shorten has dodged a bullet, while Stoljar has said his union successor Cesar Melhem, now a Victorian state Labor politician, and construction company Thiess John Holland may have committed offences in the company’s payments to the union during the construction of the Melbourne EastLink project. Discussions on the matter started in Shorten’s time.

Nor is the commission necessarily all done on the subject of Shorten – commissioner Dyson Heydon’s report comes at the end of the year.

But assuming there is nothing seriously adverse for him there, Shorten’s allegiances with and obligations to the unions still present him with credibility problems as alternative prime minister.

The details of union corruption and thuggery that have come out at the commission are appalling. It is true, as Shorten and Labor keep saying, that the commission was set up as a political exercise with him as one of its targets. But that does not alter the fact that it has exposed shocking conduct.

Some of the worst behaviour has involved the Construction, Forestry, Mining and Energy Union (CFMEU).

Surely that union should be disaffiliated by the ALP, or at least have its affiliation suspended until there is clear evidence the situation has been rectified.

But the CFMEU forms part of Shorten’s power base. It was vital at this year’s ALP national conference in helping him with the numbers on key issues, most notably the policy that allows a future Labor government to turn back asylum seeker boats.

The CFMEU’s influence was one factor in the very strong stand Labor took on the China-Australia free trade agreement.

And Shorten’s workplace relations spokesman, Brendan O'Connor, is the brother of Michael O'Connor, who is national secretary of the union.

In a September profile of Michael O'Connor, Ewin Hannan wrote in the Australian Financial Review that he “wields significant influence in both the union movement and the Labor Party. … [T]hrough O’Connor’s relationships in the ALP and with not only other unions but also the Senate crossbenchers and the Greens, he has been effective at stymying change that his members don’t agree with and driving home policies they support”.

Hannan also noted that colleagues said “the brothers are mindful of the obvious conflict of interest but watch each other’s backs as they negotiate their way through the often treacherous world of labour movement politics, and the competing interests of the party’s political and industrial wings”.

That’s just the point. Labor’s workplace spokesman and the head of a powerful union that includes a disreputable construction section should not be watching each other’s backs.

Asked about the relationship, Brendan O'Connor said in a statement to The Conversation on Sunday: “As shadow minister I’m well aware of avoiding potential conflicts of interest and I act accordingly”.

One piece of legislation that the O'Connors have helped stop is the restoration of the Australian Building and Construction Commission. Yet surely in the circumstances there is a strong case for this to be brought back.

The ALP and Senate crossbenchers have also defeated the Coalition bill on registered organisations.

Brendan O'Connor said recently this bill would place “higher penalties and a more onerous regime on officers of employer bodies and unions than those imposed on company directors”.

He said the Labor government in 2012 had toughened the laws covering these organisations. “As a result, the regulation of trade unions in Australia has never been stronger, accountability has never been higher, and the power of the FWC [Fair Work Commission] to investigate and prosecute for breaches has never been broader.”

The public and members of unions, however, may well not be reassured that sufficient has been done.

Shorten was, reasonably enough, unhappy that the royal commission released its finding about him after 8PM on Friday, and without giving prior notice. His lawyer has written to ask why his message asking about timing wasn’t returned.

The commission was at fault and it handed Shorten a political point.

But that doesn’t alter the problem he has, and should address, of apparently being too beholden to his union base.