Prosecutors have been asked to consider criminal charges against at least 22 unionists and three unions following the first two reports of the royal commission into industrial corruption.

The inquiry, headed by Justice Dyson Heydon, did not recommend action against former Labor prime minister Julia Gillard but criticised her work as an industrial lawyer in the 1990s.

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However, two former Australian Workers Union figures – including Ralph Blewitt and Ms Gillard’s former partner Bruce Wilson – have been referred to prosecutors in Victoria and Western Australia over their role in setting up a slush fund.

“The excuse that there is just one rotten apple here or there is regrettably not the case,” Employment Minister Eric Abetz said.

A third volume of the report has been kept confidential because it deals with threats to witnesses.

Senator Abetz released the two reports on Friday, and pledged to propose laws in the first siting of parliament next year that would toughen penalties for corruption and restore the construction watchdog.

Justice Heydon has asked Commonwealth prosecutors to consider charges against the Construction, Forestry, Mining and Energy Union and officials from that union, as well as seven officials from the Health Services Union.

NSW, Queensland and South Australian prosecutors have also been asked to prosecute CFMEU figures for offences including assault, threats and extortion.

The Transport Workers Union and Queensland branch of the Shop Distributive, Allied and Employees Union face action by the Fair Work Commission and Information Commissioner, respectively.

The Australian Competition and Consumer Commission will examine whether the CFMEU conspired to damage a crane business.

The minister called on Opposition Leader Bill Shorten and Labor to support tougher sanctions for union misconduct and the reintroduction of the Australian Building and Construction Commission.

“I would have thought that anybody that is committed to the trade union movement would want to see a clean trade union movement – one where there is not criminality, where there is not thuggery, where there is not funny-money dealings going on,” Senator Abetz said.

He said the question of whether Ms Gillard had done anything wrong was “very broad”.

“The important thing is that those that have done wrong, criminal activities, according to the royal commissioner, should be brought to justice,” he said.

“Ms Gillard does not fall into that category.”

The report says the criticism that “there was a lapse in professional judgment on Julia Gillard’s part” was justified.

The minister said some companies that had done deals with unions were also “not cast in a good light” in the report released on Friday, but there were no charges recommended against any of them.

The inquiry is set to complete its work by the end of 2015.

-AAP