Trading away penalty rates "sells workers down a river," the federal Liberal cabinet minister Christopher Pyne said on Friday, as he continued his attack on Opposition Leader Bill Shorten who is set to face the royal commission into trade unions next month.

Mr Pyne's comments, deploring the negotiated cuts to penalty rates is despite a near unanimous view within the Liberal party that penalty rates are too high, which is reducing employment opportunities for young people and hurting small business.

Mr Pyne seized on a report in News Corp papers on Friday that cites two agreements between 1998 and 2005 deal struck between the AWU, where Mr Shorten held senior roles, and cleaning company Clean Event in which penalty rate loadings were reduced in return for a pay increase. Cleaners typically work during penalty rate hours, in the early mornings and late evenings.

One union source said the deals were symbolic of why rival unions privately call the AWU "Australia's Worst Union". The source said it was commonplace for the union to undercut other unions in any given industry and in effect give favoured business considerable advantages to other employers.