The builders under my umbrella get looked after that way
In the layered world of infrastructure procurement, the line between legitimate enterprise and shadowed influence is rarely drawn in plain sight. A Victorian government road upgrade worth $222 million has brought that line into focus, as labour hire firms connected through family ties to Melbourne underworld figure Mick Gatto secured subcontracting work — with the overseeing agency apparently unaware of the connections it was publicly celebrating. The episode invites a deeper question that extends well beyond one project: when union relationships, corporate structures, and government contracts intertwine across generations and entities, do the oversight mechanisms designed to protect public interest still reach far enough?
- A government agency promoted an Indigenous labour hire firm on social media, then quietly deleted the post once journalists revealed the firm's ownership traces back to the daughter of a notorious Melbourne underworld figure.
- Mick Gatto openly acknowledges managing industrial relations for the connected companies, describing his union access as the invisible infrastructure that keeps construction sites running — and workers from being sent home.
- The corporate history of M Group carries its own warning signs: a predecessor entity collapsed into liquidation owing the tax office over $700,000, only for a near-identical operation to rise in its place days later under a fresh name and a new CFMEU agreement.
- Victorian procurement rules place responsibility for subcontractor selection with construction partners like BMD, creating a structural gap where government agencies can remain genuinely — and conveniently — uninformed about who is ultimately benefiting.
- Indigenous certification requirements are being met on paper, but the shared directorships and union relationships that animate these firms suggest the spirit of those policies may be navigating well outside the boundaries their designers intended.
A labour hire company with ownership links to Melbourne underworld figure Mick Gatto has won work on a $222 million Victorian government road upgrade, reigniting questions about union influence over construction procurement and whether public agencies have the tools to detect it.
Jarrah, an Indigenous labour hire firm handling traffic management on the Mickleham Road Upgrade in Greenvale, is 16 per cent owned by Sarah Awad — Gatto's daughter — through her company Taggo Pty Ltd. Awad also holds 25 per cent of M Group, a related labour supply business that shares directors with Jarrah. When Major Roads Project Victoria promoted Jarrah on social media, it appeared unaware of these connections, deleting the post after journalists raised questions.
Gatto has been candid about his role. He told the Financial Review he handles all industrial relations and union matters for the companies — work he says he has performed for two decades. His leverage rests on longstanding relationships with the CFMEU, including Victorian secretary John Setka, forged in the mid-1990s when Gatto helped resolve an industrial dispute. In his autobiography, he described the arrangement plainly: when a builder came under his umbrella, he would call the union and say 'he's with me,' ensuring disputes were directed to him rather than resulting in shutdowns. Securing CFMEU enterprise agreements — effectively mandatory for major Victorian projects — is understood to be central to what Gatto provides.
The corporate history of M Group adds further texture. A predecessor entity, M Group Construction Services, collapsed into liquidation in 2017 owing the Australian Tax Office $726,000, with cashflow problems traced to late payments from a related company. Within weeks, a new entity emerged under the same trading name, with a fresh CFMEU agreement. The same directors — Michael Portia and Tony Paragalli — remain in place across both M Group and Jarrah.
Major Roads Project Victoria stated that subcontractor selection is the responsibility of its construction partners, and that all contractors must meet legislative requirements. The agency also noted its commitment to creating opportunities for Aboriginal Victorians. BMD, the head contractor on the project, did not respond to requests for comment.
The arrangement satisfies formal requirements — Jarrah's ownership structure meets Victoria's threshold for Indigenous business certification — but the shared leadership, intertwined corporate histories, and Gatto's union relationships raise pointed questions about whether procurement oversight is designed to follow influence as it actually moves, or only as it appears on paper.
A labour hire firm with deep ties to Melbourne underworld figure Mick Gatto has secured significant work on a $222 million Victorian government road project, raising fresh questions about union influence over construction procurement and the oversight mechanisms meant to guard against it.
Jarrah, an Indigenous labour hire company, is handling traffic management on the Mickleham Road Upgrade in Greenvale, a project run by construction firm BMD. The connection to Gatto runs through his daughter Sarah Awad, who holds a 16 per cent stake in Jarrah through her investment vehicle Taggo Pty Ltd. Awad also owns 25 per cent of M Group, a related labour supply firm that shares directors with Jarrah. When Major Roads Project Victoria, the agency overseeing the upgrade, promoted Jarrah on social media, it appeared unaware of these family connections. The agency deleted the post and video after being questioned about the links.
Gatto himself has been explicit about his role. He told the Financial Review that while the companies are not formally his, he handles all their industrial relations and union matters—work he says he has been paid to do for two decades. "I look after a few companies on that level," he said, adding that the arrangement had been "through the courts, it's been publicised." He denied that his firm, Arbitration and Mediation Services, ever owned a stake in M Group, though corporate records show it was an original shareholder when M Group was established in November 2016 before selling its shares to his daughter's company a month later. He also distanced himself from Jarrah, describing its Indigenous director Stan Dryden as simply "a friend of mine and he's a good bloke."
The real leverage lies in Gatto's relationship with the construction unions, particularly the CFMEU. Sources say Gatto was instrumental in securing the CFMEU agreements that both M Group and Jarrah hold—agreements that are effectively mandatory for firms wanting to work on major Victorian projects. Gatto's connection to CFMEU Victorian secretary John Setka dates to the mid-1990s, when Setka asked him to help resolve an industrial dispute. After successfully intervening, Gatto was introduced to other union officials and began working as a fixer for builders facing union problems. In his autobiography, Gatto described the arrangement plainly: when signing on a new builder, he would ring the union and say "he's with me," ensuring that if problems arose, the union would contact him rather than simply shutting down the job. "The builders under my umbrella get looked after that way," he wrote. "Without me there the union would just stop the job and send the workers home, the builders could lose a fortune."
The corporate history of M Group itself reveals instability beneath the surface. The entity was established in 2015 when directors Michael Portia and Tony Paragalli purchased M1 Traffic Control Pty Ltd. Portia then set up a related company, M Group Construction Services, with its own CFMEU agreement, to supply traffic management labour. By June 2017, however, M Group Construction Services collapsed into liquidation owing the Australian Tax Office $726,000. According to the liquidator's report, the primary cause was that M1 "did not pay on time," creating severe cashflow problems. Just weeks before the liquidation, Portia exited the company and a director penalty notice was served on his replacement. The company's name was changed to its ABN number, employees were terminated, and a new entity—M Group Trades and Labour—was established with another CFMEU agreement, trading under the same name as the defunct company. Portia and Paragalli remain directors of both M Group and Jarrah.
Major Roads Project Victoria responded to questions by stating that "the selection of subcontractors and management of industrial relations is the responsibility of our construction partners." The agency said all contractors must meet legislative and contractual requirements and that it actively encourages cooperation in the construction industry. It also noted that it is "providing meaningful business and employment opportunities for Aboriginal Victorians and businesses." BMD, the construction partner running the Mickleham Road project, did not respond to requests for comment, though in a video promoted by MRPV on LinkedIn, BMD project manager Daniel Frazer praised Jarrah as "a new business" and said the two-year project would give them "different opportunities and grow the business and skill set."
Other Indigenous labour hire firms contacted by the Financial Review declined to speak publicly about CFMEU control of the industry, citing fear of damaging their business relationships. The use of Indigenous labour hire firms in joint ventures with traditional labour suppliers has become increasingly common as a way to win government contracts. While both M Group and Jarrah share directors, Jarrah's ownership structure meets Victorian requirements for Indigenous businesses to be at least 50 per cent Indigenous-owned, and it is certified by Kinaway, the state Indigenous business chamber. The arrangement appears to satisfy regulatory requirements while maintaining operational control through shared leadership and Gatto's union relationships—a structure that raises questions about whether procurement oversight is keeping pace with how influence actually flows through the construction industry.
Citações Notáveis
My daughter's got an interest in M Group and I do all their industrial relations issues. All their union issues I sort them out.— Mick Gatto
Each time I sign on a new builder I ring the union and tell them 'he's with me' and that if there are any problems they should call me.— Mick Gatto, from his autobiography
A Conversa do Hearth Outra perspectiva sobre a história
Why does Mick Gatto's involvement matter if his daughter is the formal shareholder and he's just providing industrial relations advice?
Because industrial relations advice in construction isn't neutral work—it's the key to accessing union agreements that are effectively mandatory for major projects. Gatto's real product is his relationship with the CFMEU and his ability to smooth problems before they shut down a job.
But Jarrah is Indigenous-owned and meets the regulatory requirements. Isn't that the point of these programs?
It is, and Jarrah does meet the ownership threshold. The question is whether the structure—shared directors, related companies, Gatto's behind-the-scenes role—represents the spirit of Indigenous business development or a way to satisfy the letter of the law while maintaining control elsewhere.
The government agency said they didn't know about the Gatto connection. Does that mean there's no actual wrongdoing?
It means the procurement process didn't catch it, which is itself revealing. The connection isn't hidden—it's in corporate records. The question is whether the oversight mechanisms are designed to look for these kinds of relationships.
What about M Group's history of owing the ATO money and then restructuring?
That's the pattern that repeats in construction labour hire. A company accumulates debt, collapses, employees are terminated and rehired by a new entity with the same CFMEU agreement and the same directors. The debt stays behind, the operation continues.
Is Gatto actually breaking any laws?
That's what the structure is designed to answer. By having his daughter hold the shares and him provide services as a contractor, the arrangement sits in a legal gray zone. Whether that's a problem depends on what the procurement rules actually require agencies to investigate.
Why won't other Indigenous labour firms talk about this?
Because the CFMEU agreements are how you survive in this industry. Speaking publicly about union control risks being seen as disloyal, and that's a risk no firm can afford to take.