The ABCC’s chief lawyer has walked out in protest against his former boss's conduct.

Tony Southall QC started his five-year term as deputy commissioner of the Federal Government's construction watchdog, the Australian Building and Construction Commission (ABCC), in August.

He has now handed Employment Minister Michaelia Cash his resignation.

He bailed in the wake of revelations that ABCC commissioner Nigel Hadgkiss had broken Fair Work Act laws between January 2014 and July 2016.

Mr Southall said it was now “untenable to continue in the role”.

He said he only learnt of how serious the matter with Mr Hadgkiss was when he read the Federal Court judgment after Mr Hadgkiss had quit.

“At no time prior to the judgment, nor his subsequent resignation, did Mr Hadgkiss discuss the matter with Mr Southall,” Mr Southall’s statement said.

“In the circumstances, Mr Southall desires to totally disassociate himself from the conduct of Mr Hadgkiss, and considers that he had no alternative but to resign his position as deputy commissioner.”

Employment Minister Michaelia Cash said the statement was the first she had heard of his concerns.

“They were not the reasons given in the resignation that was provided to myself,” she told Senate estimates.

Labor has demanded an inquiry into why Mr Hadgkiss was made commissioner of the ABCC in December 2016, even though Senator Cash knew about his conduct two months earlier.

“[Malcolm] Turnbull took Australia to a double dissolution election over the ABCC, and it is already in deep crisis because the minister and Turnbull allowed Mr Hadgkiss to continue as commissioner despite knowing about his unlawful conduct for more than 12 months,” opposition employment minister Brendan O'Connor said.

“This is a scandal and nothing short of an independent inquiry will do.”