Unions NSW has voted to dump former Health Services Union (HSU) boss Michael Williamson as its vice president and has also moved to suspend the troubled union from its organisation.

Alleged corruption and financial mismanagement in the HSU – which represents 77,000 aged care and health sector workers – is the subject of police investigations in NSW and Victoria, an internal inquiry headed by Ian Temby QC and a Fair Work Australia investigation.

Mr Williamson was asked to resign last week from his $350,000-a-year role at HSU.

He has also resigned as a Union’s NSW representative on the board of First State Super.

On Thursday night, Unions NSW announced that it had accepted his resignation and said it would also suspend the HSU’s affiliation “until governance issues can be resolved”.

Unions NSW Secretary Mark Lennon said the suspension of the HSU East branch sent a message about appropriate behaviour and governance for the NSW trade union movement.

“Six hundred thousand working people across NSW rely on a strong and vibrant trade union movement to represent their interests in the workplace and tonight’s decision allows us to get on with the job of representing working people,” Mr Lennon said in a statement on Thursday evening.

“This was not an action taken lightly, but it is in the interests of all working people across the state.

“Unions NSW will continue to assist the members of the Health Services Union in whatever way we practically can.”

“In due course, Unions NSW hopes to restore the HSU to full affiliation, but only once we are satisfied that all governance issues have been rectified.”

Earlier on Thursday, HSU acting president Chris Brown said he was concerned by talk of the federal government or Fair Work Australia deregistering his union.

“But I think it’s a fair way off,” Mr Brown told ABC Radio.

The HSU east branch, the union’s “problem child”, would still be able to operate because it was registered under NSW laws.

“Penalising those other branches for doing absolutely nothing wrong … would be a tragedy,” Mr Brown said.

Asked if the HSU was so damaged it should transfer some of its members to other unions with clean records of honesty he said: “That’s certainly something in the back of my mind.

“I don’t think we’re at that stage yet, but we could get there if these accusations continue and the union continues to be damaged.”

Last week, ACTU suspended the HSU, to reinforce its “zero tolerance” stance on corruption.