CFMEU calls for Fair Work Ombudsman to be replaced with worker-focused regulator 

The Construction, Forestry, Maritime, Mining and Energy Union (CFMEU), one of the principal trade unions for Australia, has made its stance clear that the Fair Work Ombudsman (FWO) needs to go.

CFMEU has called for the Ombudsman to be replaced with a regulator focused on “real issues affecting workers”.

CFMEU National Secretary Zach Smith said the FWO had failed to tackle wage theft, sham contracting and corporate insolvency — three of the most significant issues facing the construction industry.

An estimate from Price and Waterhouse Coopers (PwC) suggests construction workers are being underpaid $320 million annually.

“Australian construction workers are facing endemic corporate insolvency, wage theft and sham contracting,” Mr Smith said.

“But the ombudsman is prioritising the anti-worker ideological fights of the previous Coalition government

“The Fair Work Ombudsman’s priorities are all wrong. It is fundamentally broken beyond repair; we need to scrap the Fair Work Ombudsman and start again.”

The CFMEU secretary said the new workplace watchdog “must drop the anti-union, anti-worker” biases that the union claimed were perpetuated by the previous government.

“Workers deserve nothing less than a watchdog with teeth that is focused on them, not playing nice with businesses who do the wrong thing,” Mr Smith said.

The CFMEU stated that two-thirds of the money recovered by the FWO in the last five years came from self-reported wage theft.

This means that the majority of wage theft had been reported by large corporates themselves rather than being acted upon by the FWO.

“Wage theft is rife in construction, but we simply don’t have a watchdog which is pulling its weight,” Mr Smith said.

“The FWO is relying heavily on large corporates self-reporting wage theft despite being the regulator for 13 million Australian workers.

“If we want to properly address wage theft, we need a tough cop on the beat, not a regulator that needs bosses to tell them when workers have been ripped off.”

The FWO received $9.8 million in the 2019/2020 budget to set up a Sham Contracting Unit, but this unit has only recovered $812,893 in the three years since — representing 0.1 per cent of total recoveries made by the FWO.

Further, since the abolishment of the Australian Building and Construction Commission (ABCC) in December, now under the command of the FWO, two major building companies have gone under, with contractors and workers owed at least $75 million.

CFMEU said the new regulator would need to stop prosecutions against unions supporting workers’ rights.

The trade union also said the regulator should be armed with the ability to address security and payment issues productively, as well as form compliance orders to protect workers’ rights and the recovery of unpaid wages.

Supervision by a board, of which 50 per cent would be worker representatives, would oversee these processes.

Independent Senator David Pocock has backed the CFMEU’s call for change and is asking the Federal Government to implement a review.

The senator said the review should include the creation of statutory trusts, making it easier for money to be recovered when companies collapse.