The industry union has defended its decision to demand $30,000 from 23 fashion brands in order to settle cases out of court.
Earlier this month, ragtrader.com.au reported the Textile, Clothing and Footwear Union of Australia (TCFUA) had commenced court action against a number of local brands.
It alleged the brands had controvened workplace laws around the exploitation of contractors.
It has since been revealed the union offered each brand the opportunity to settle out of court.
Employment Minister Eric Abetz attacked the move in weekend papers, claiming the union was attempting to "blackmail" brands to make up for shortfalls in funding.
The union issued a statement to ragtrader.com.au, describing Abetz's comments as "highly defamatory".
"Senator Abetz is the cheer squad for companies that are now attacking the proceedings against them and who chose not to voluntarily rectify their own supply chain transparency when the union wrote to them about doing so almost a year ago."
Despite many brands being unaware of the action when first contacted by ragtrader.com.au, the union said its current pursuit of settlement is justified.
"It is completely normal and appropriate for parties to resolve legal proceedings by reaching voluntary settlement agreements.
"On the last occasion the Federal Court heard a similar matter, it imposed a penalty payable to the union of $110,550.
"Any settlement sums or penalties paid to the union contribute towards the costs of the TCFUA’s award and supply chain compliance work to end the exploitation of outworkers and sweatshop workers, the education of these workers about their rights and the provision of support to these workers.
"The union’s legal proceedings are about companies in the TCF industry not abiding by the law.
"In contrast, Senator Abetz and the federal government would prefer to protect, support and defend companies in the TCF industry who break the law.
"This federal government has been telling unions that industrial action is illegal, protest action is illegal and now appear to be claiming that legal action is illegal."