The Minister for Employment and Workplace Relations, Bill Shorten, intends to place the scandal-plagued Health Service Union into administration, the Federal Court has been told this morning.
Richard Niall, SC, for Mr Shorten, told the court the minister intends to issue an application under the Fair Work Registered Organisations Act.
Bill Shorten ... intends to place the HSU into administration. Photo: Penny Bradfield
Spiteful move: Jackson
Outside the court, the national secretary of the HSU, Kathy Jackson, said Mr Shorten's move was "a cheap political stunt".
"We will get to the administration point whether he applies for it or we apply for it. That will happen.
Kathy Jackson. Photo: Nick Moir
"This is a spiteful move. It's about protecting the ALP and protecting their own backsides. They should have taken action on [former national secretary and federal MP Craig] Thomson and [the HSU East general secretary Michael] Williamson earlier and they didn't and now they want to shoot me down.
"It's very predictable; we've been calling for intervention for a while now. The union is in crisis. We're in court trying to sort this out," Ms Jackson said.
"Bill Shorten should not participate in the decision-making of the HSU.
"We've ended up [here] because of his and others in the ALP trying to win this union for their own political power.
"This is not about putting an administration in place that suits Bill Shorten.
"Bill Shorten should go back and be the Minister for Industrial Relations and not the minister for the HSU."
When asked to comment about the "gang of 10" HSU secretaries trying to oust her, she said: "Good luck.
"What we are seeking is that the rules of the union are adhered to. There are 20 people on that council that have been getting a vote that should not have got a vote.
"[Peter] Mylan, Williamson and [Gerard] Hayes have been allowing these people to vote, which skews the result. So what we are seeing is an outcome where the people who can vote do vote and the people who don't, don't vote.
"I think [the minister's] motives are totally different to our motives. If it's urgent, they should have turned up today and had their application ready to go, not have another stunt out there which is well known for.
"It means they're not serious about the application, they're here to grandstand and get the five-second news grab that he's very good at. If he was serious about this application he should have been joining us seven months ago when we were calling for help from the government and other parties. And yet here he is today making an application which wasn't even an application, it was just foreshadowing something he may do.
"Where was he seven months ago, six months ago? Where was he last week?
"I think there should be a council meeting. There's a deliberate tactic not to have these council meetings by the leadership of this union, or the NSW part of this union. They want to protect [Mr] Williamson, they don't want the members to hear about the Temby report. Mr [Ian] Temby or [accountant Dennis] Robertson were supposed to turn up to the council to deliver interim findings.
"We won't have that opportunity now. I think there still needs to be a meeting of the council, or at least communication to the membership to let them know what we're up to.
"This shutting down of meetings and not allowing members to have their say ... or to hear about the Temby outcome is a dire state of affairs and having the minister intervene today doesn't mean that that's going to happen. It means it's going to be prolonged even further.
"So here is the minister intervening into the HSU matters where, what I would say to him is clean up your own backyard, look at your Parliament, intervene there and then we won't have these sort of problems occurring. If they're serious about legislating, legislate about electoral funding, legislate about affirmative action, legislate about how to make unions more accountable to their members and not keep pulling a stunt like this.
"Yes the union is in disarray."
The barrister for 48 of the respondents, Richard Kenzie, QC, told the court the union council intends to convene a meeting within three days of the court's decision.
"Our clients are prepared to and propose to call a meeting within three days of any decision," he said.
Justice Geoffrey Flick has adjourned the matter to May 3.
Unusual and rare action: Shorten
In what he described as "unusual and rare action," Mr Shorten has announced that the federal government has taken legal action in the Federal Court to have an administrator appointed to the dysfunctional HSU East branch.
Mr Shorten said that the move had the support of the broader union movement including the ACTU and Unions NSW.
Members of this branch of the union deserved better than the "claims and counter claims" of the warring factions headed by NSW boss Michael Williamson and his Victorian rival Kathy Jackson, he said.
Mr Shorten said that the Commonwealth had until the close of business on Monday to file their application for an administrator.
He also called for all the positions of elected officers to be declared vacant in the hope that fresh elections could restore democracy to the troubled union.
Mr Shorten also said that, while he believed, there was legitimate interest in the findings of the Fair Work Australia investigation into the administration of the union, he was concerned that the release of the report might put at risk any future civil or criminal charges.
Sensible solution: Brown
Chris Brown the acting national president of the Health Services Union today welcomed the government's intervention in the Federal Court battle for the HSU East.
Mr Brown said: "The minister's intervention which, if successful, will see an administrator appointed to the East Branch, is a very sensible solution which will see a halt to the bitter factional infighting between Kathy Jackson and Michael Williamson."
In a statement, Mr Brown said: "The scheme of administration proposed by the minister will see the domination of the East Branch broken up into the branches which existed prior to the amalgamation in August 2010. That is the NSW Branch, the Victoria No.1 Branch and the Victoria No.3 Branch will be reconstituted.
"All the elected positions will become vacant and the administrator will run the branch until fresh elections can be held.
"By calling a halt to the in-fighting between the Jackson faction and the Williamson faction, the branch has an opportunity to stabilise and focus on the members ahead of fresh elections.
"The most important part of the proposed administration is that the members of the East Branch will get an opportunity to decide for themselves who they want to lead their branch," Mr Brown said.
Mr Brown said that "the ideal outcome would be for both Michael Williamson and Kathy Jackson to walk away and give the union back to the members."
Mr Brown said that a number of HSU branches would also seek leave to intervene in the Federal Court action to support putting the East Branch into administration.
These branches include Tasmania, South Australia, Western Australia and the two non-east Branches in Victoria.
ACTU supports government move: Kearney
The president of the ACTU, Ged Kearney, said unions would usually oppose an application by the federal government to appoint an administrator to the HSU East branch.
However, the governance of the HSU East branch has become so dysfunctional that the ACTU was supportive of the government's "very serious and grave step", Ms Kearney said.
"We do recognise the situation with the HSU East branch has now reached a point of serious dysfunctionality and is deteriorating into what seems to be factional fights between Ms Jackson and Mr Williamson, and other factors within the HSU East branch."
"We are supporting this action of the government based on the fact that we now need a circuit breaker that will ensure a very strong and viable HSU East branch that can care for its members and operate in their best interests," Ms Kearney said.
The ACTU would only accept an administrator being appointed to the HSU East branch, Ms Kearney said, as other branches of the HSU operating around Australia were operating "with robust governance".
When asked if the ACTU could have acted earlier, Ms Kearney said: "This has been a long, complex process and I'm sure that people have been frustrated with the amount of time it's taken but here we are now, we are at a very good point and I think this is an excellent move."
Appropriate step: Unions NSW
Unions NSW secretary Mark Lennon said it was an appropriate step to "an effective functioning HSU East branch in NSW".
"It's reached such a situation that we can see no other path than that has been proposed by the federal government today," he said.
Mr Lennon said unions NSW had suggested to the HSU East branch that it enter voluntary administration.
"We have tried to sort this out ourselves as a union movement but we haven't been able to prevail, so in that regard, this we believe is the only appropriate action in the best interest of the members," Mr Lennon said.
- with Kate McClymont