It released a slew of Slack messages and emails it said showed the union secretary deliberately and over a substantial period of time misused his position as First Super co-chair, amounting to a breach of his director duties to act in the best financial interests of super fund members.
The regulator said O’Connor was quietly involved in negotiations on behalf of the union with the “intention of benefiting the union at the expense of First Super and its members’ best interests”. It alleged O’Connor had instructed the union’s MESC contract manager to invoice the super fund for the coordinator role, and then withdrew the advertised vacant position before appointing BT in that role with effect from April 1.
While the union boss admitted he provided the CFMEU manufacturing division’s finance and administration committee updates on the negotiations regarding the MESC contract in June, August and September 2020, he denied he was involved in the “ongoing conduct of the negotiation on behalf of the union”.
He also disputed APRA’s evidence that the union sent a $125,000 invoice to First Super on March 10, 2020, claiming the fee sought was $31,262.89.
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“He says that on 25 March 2020, he sent an email to a manufacturing division employee with the initials PG, which approved draft correspondence to be sent to applicants for the First Super coordinator job and draft correspondence to be sent to the applicants for the admin officer job, which explained that the manufacturing division was withdrawing those vacant positions,” O’Connor’s defence states.
“Says further that the reason provided in the draft correspondence referred to above for the withdrawal of the positions was due to the COVID-19 pandemic and the consequent disruption across Australia.”
In October 2017, First Super and the CFMEU entered into a written deal known as the Member and Employer Co-ordinator Services Agreement, or MESC contract. Under the arrangement, the union was to manage the employment of the co-ordinator responsible for recruiting and retaining First Super members, while the fund would pay the union the employee’s fees and reimburse their expenses.
Two years later, O’Connor told a union employee, known as CS, the board of First Super had or would approve the contract’s extension without going to tender. He told CS this was “an opportunity to get some more money out of the fund”, according to documents APRA filed in court.
O’Connor denied those allegations.
APRA has asked the Federal Court to remove O’Connor from the board of First Super, ban him from acting as an officer of any super fund, and impose financial penalties.
The matter will return to court in April.
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