Australian unions have undergone a dramatic transformation over the last three decades. This report finds that the modern-day union movement has become a self-serving, complex commercial network that has monetised the industrial relations system to extract financial and political benefits for itself and its allies, including the Australian Labor Party (ALP). 

Rather than adapting to remain relevant to workers, unions have shifted to alternative revenue sources to remain financially sustainable. Successive ALP governments at both a state and federal level have actively facilitated and expanded these financial arrangements through regulatory measures designed to strengthen the business model. 

This report provides recommendations to protect members’ interests over those of union profiteers. It proposes that governance standards for worker entitlement funds and superannuation funds must be strengthened. The proposed measures aim to enhance transparency, curb conflicts of interest and restore trust in these increasingly prominent financial institutions.

Recommendations

• Strengthen Worker Entitlement Funds (WEFs)
  1. End the Australian Securities and Investments Commission (ASIC) exemption
  2. Introduce a ‘Best Financial Interests of Members’ requirement
• Strengthen superannuation funds
  1. Tighten fitness and propriety standards
  2. Mandate board expertise
  3. Enhance governance
  4. Empower the Australian Prudential Regulation Authority (APRA) to remove trustees
  5. Cap non-executive director tenure at 10 years.