Ged Kearney, the president of the Australian Council of Trade Unions, will contest the Batman byelection for Labor and has delivered a scathing assessment of the Adani coalmine in her first media appearance.

The opposition leader, Bill Shorten, confirmed the star recruit for Batman on Friday, and warned that Labor is “increasingly sceptical” about the Adani mine, which is seen as key to boosting the ALP’s chances in the progressive, inner-Melbourne seat.

Kearney is contesting the seat after MP David Feeney resigned over dual citizenship, but will face an uphill battle. The Greens vote is rising in Batman and the minor party is applying pressure on Labor to do more to stop the Adani mine and proposing progressive policies like the reversal of electricity privatisation.

Shorten – who began the week by hinting Labor could veto the mine – referred to reports in Guardian Australia that Adani submitted an altered laboratory report while appealing a fine for contamination of sensitive wetlands on the Queensland coast near the Great Barrier Reef.

Shorten said it was a “scandalous allegation” accusing Adani of “falsifying scientific evidence”.

“If this is true then that’s a very serious matter and I call upon the federal government to immediately investigate ... to ascertain if [it’s] true.

“Adani does not deserve a licence to operate a coalmine if they’re relying on false statements and false facts.”

“Personally, I can’t really see Adani [Carmichael mine] going ahead,” Kearney said, referring to environmental concerns but broadening her critique to claim the company are “not good employers” and “don’t care about the communities” affected.

Shorten spruiked Kearney’s credentials as a local who grew up in the electorate and her work “leading the fight against cuts to penalty rates and the increasing casualisation and insecure work”.

Kearney, a former secretary of the Australian Nursing Federation, was looking at a state seat but has been prevailed upon to run federally in a seat ALP insiders confess the party will struggle to hold.

Kearney spoke about her work at the ACTU to achieve a “just transition ... to a clean energy society”, for migrant workers and refugees, to achieve a living wage and paid domestic violence leave as a workplace entitlement.

“I thought about all those things and I thought how can I best carry on that fight?,” she said. “I can best carry on that fight here in the federal seat of Batman.”

Kearney is considered Labor’s best hope of holding the seat against the rising tide of the Greens, whose achieved a 9.6% two-party-preferred swing against Labor at the 2016 election.

Alex Bhathal, who Greens leader Richard Di Natale confirmed on Friday would recontest the seat, was 1.03%, or just 1,853 votes, shy of Labor in 2016.

Labor’s hopes are also complicated by the possibility the Liberals may not stand a candidate, which would help consolidate the anti-Labor vote.

When the Liberals did not contest the November byelection in the Victorian state seat of Northcote, which is in the same geographical area as Batman, the Greens snatched the seat from the Victorian Labor government.

Liberal Victorian state president Michael Kroger told ABC Radio on Friday that he felt “not good at all” about running a campaign that would, in effect, support Labor’s candidate in Batman.

But Kroger said he would feel “worse” if the Liberals did not run candidates contesting elections against Greens who may have a “record of anti-semitism”.

Kroger was not levelling an allegation of anti-semitism against Bhathal but suggesting he would scrutinise her record because – in general – a Greens’ candidate’s positions on Israel’s treatment of Palestine should determine if the Liberals ran a candidate.

Di Natale told Radio National that Kearney is “a good person” but “is going to be arguing for a whole range of bad policies”.