Labor has joined the Abbott government to pass a parliamentary motion apologising to Health Services Union members for the conduct of convicted former MP Craig Thomson.
But Opposition Leader Bill Shorten stopped short of meeting Coalition demands that the Labor Party repay union members the $267,000 Thomson spent on electioneering.
Earlier this month the Melbourne Magistrates Court found Thomson guilty of defrauding the Health Services Union by spending members' money on prostitutes, inappropriate travel and his 2007 election campaign in the marginal seat of Dobell.
While introducing the unusual motion on Tuesday afternoon, leader of the house Christopher Pyne told Parliament: ''The former member for Dobell used parliamentary privilege to defame individual members of this House and also individuals outside the Parliament and to mislead the Parliament with a fantastic story that he then did not repeat in court when he had the opportunity to stand by it.''
While welcoming Labor's support for the motion, Mr Pyne said a "stain" would remain on the party's soul unless the ALP repaid $267,721 to the Health Services Union.
"The very least thing the leader of the opposition could do, Madame Speaker, is to pay that money back – pay it back to the members of the Health Services Union," Mr Pyne said.
"The leader of the opposition talks a big game but when he gets the opportunity to deliver he doesn't deliver."
Mr Pyne said a particular apology was owed to the individuals Thomson attacked in his May 2012 speech in which he denied the fraud allegations. These included Health Services Union National Secretary Kathy Jackson, who took fraud allegations to police.
"Kathy Jackson is a revolutionary," Mr Pyne said. "And revolutionaries aren't always perfect. Revolutionaries sometimes have to cut corners and do things in order to bring about a result. But she will be remembered as a transforming union leader."
In his reply speech, Mr Shorten said: "Mr Thomson's actions – as outlined by Melbourne Magistrates Court this year – were a deep and unforgivable betrayal.
"These actions are contrary to everything the trade union movement stands for. These actions were contrary to everything the Australian Labor Party stands for.
"Mr Thomson abused the trust of this place, his colleagues, his constituents and thousands of hardworking Australians in the health services sector."
But Mr Shorten did not agree to Mr Pyne's demand to pay the Health Services Union $267,000 or to apologise for the fact Labor helped pay his legal bills.
Mr Shorten, a former national secretary of the Australian Workers Union, said most union officials do good work defending workers' pay and conditions.On Monday the House voted to refer Thomson to the privileges committee for allegedly misleading Parliament.