Australian Fire Department Sues Firefighters Union Over Income Protection Payments

Fire Rescue Victoria (FRV), the statutory authority responsible for career firefighting in the state of Victoria, Australia, has filed suit against the United Firefighters Union (UFU) alleging that more than $1.6 million in taxpayer-funded payments were made to the UFU in connection with an income protection scheme for firefighters and then spent on purposes other than providing income protection benefits.

The suit was filed in the Victoria Registry of the Federal Court of Australia. According to ABC.net.au, the income protection arrangement at issue is funded through Fire Rescue Victoria. Under the scheme, taxpayers, via FRV, pay a weekly amount—reported to be at more than $50 per firefighter—to secure income protection coverage for UFU members who are unable to work due to sickness or injury. Until 2023, the funds were managed and administered by ATC Insurer. In 2023, at the union’s request, Fire Rescue Victoria agreed to a change in the arrangement under which the scheme was administered through a discretionary trust, a shift that later became the focus of the Federal Court proceedings.

Under the new arrangements, the trust continued to provide the income protection benefits for firefighters, but also made monthly “service fee” payments to the UFU. These payments started at about $30,000 per month, then rose to $60,000 in 2024. Over the course of the arrangement, those service fees totalled approximately $1.6 million. FRV alleges that the union spent those funds on matters unrelated to the delivery of income protection benefits.

Fire Rescue Victoria’s claim in the Federal Court asserts that the conduct of the union in relation to the scheme was deceptive and misleading, and it is seeking restitution of the payments. According to the court documents, similar payments were described in filings with the Fair Work Commission as a “secret commission.”

Fire Rescue Commissioner Gavin Freeman is quoted by ABC.net.au as saying that the authority has “an obligation to challenge” what it says was the diversion of public funds and that the arrangement has significantly increased FRV’s fringe benefits tax liability. He said, “This is public money. This is the Victorian taxpayer’s money we’re talking about… I’ve got a responsibility to make sure it’s been used appropriately.”

The trust that managed the income protection coverage reportedly has ceased making service fee payments to the UFU. FRV also notes that the fringe benefits tax bill related to the scheme has risen by about $10 million as a result of expenditures it alleges were unrelated to benefits.

The proceedings take place against a backdrop of broader industrial tensions between Fire Rescue Victoria, the UFU, and the Victorian government over pay, conditions, and operational concerns.

In responding to questions about the lawsuit, UFU secretary Peter Marshall linked the court action to the union’s ongoing disputes with the Victorian government and Fire Rescue Victoria over the West Gate Tunnel Project. Marshall suggested the legal proceedings were connected to the union’s complaints about safety and operational issues associated with the tunnel, which have been the subject of prolonged industrial and political conflict.

Marshall stated, “The most important issue is firefighter safety,” and criticized what he described as substantial legal costs being incurred by taxpayers as a result of FRV’s disputes with firefighters.

FRV is seeking orders for repayment of the funds and related relief. More on the story.