Unison's UK ruling body suspended Karie Murphy, who is tipped to secure the Labour candidacy for Falkirk, from holding office in June 2006 after an investigation into the Glasgow branch where she had been the secretary for a decade. However, Murphy resigned from Unison four months later and the proceedings ended by default before there was a disciplinary hearing.
Murphy, 49, a former chair of Scottish Labour, strongly denies any wrongdoing, and says she left the union "due to bullying and continued harassment", and that her exit was unrelated to Unison's "politically motivated" investigation.
There is no suggestion she faced criminal charges.
Murphy went on to work for a number of Labour MPs and is currently office manager for the West Bromwich MP Tom Watson. She is now involved with the powerful Unite union, the Labour party's biggest donor, which is backing her to be the Falkirk candidate.
The seat is currently held by former Labour MP Joyce, who resigned from the party last year after pleading guilty to assaulting four people in a drunken brawl in a Commons bar.
His exit at the 2015 general election leaves Labour looking for a new candidate.
In 2004, Unison audited health branches in Glasgow prior to their merger, one of which was the Glasgow Community Health Branch, where Murphy had been the long-serving branch secretary. This ultimately led to a detailed investigation of Murphy's branch, which was suspended around July 2005, according to her lawyer.
Murphy offered to co-operate with the investigating officer, Carol Judge. By June 2006, Unison informed Murphy that the "Rule I" investigation had concluded "there is a prima facie case to answer".
The same month, Unison's National Executive Council agreed to bring disciplinary charges against Murphy and to suspend her from holding office with the union, as the charges related to what Unison described as "alleged serious financial irregularities". However, she had already resigned.
People applying to stand for Labour at either Westminster or Holyrood are asked to declare any matters in their "political or personal life".
Murphy's lawyers, Mishcon de Reya, said: "Our client was not advised that any disciplinary action was to be taken against her or any other branch committee member - nor charges to be brought...
"Our client resigned due to bullying and continued harassment and given the fact that she had changed job to work in the private sector she changed to the appropriate recognised trade union. It had nothing to do with any investigation."
On Unison suspending Murphy from holding office as per Unison Rule C7.4.2, Mishcon de Reya stated: "This is incorrect. This rule could not have been applied (if it were appropriate, which is denied) given that as of August 2005, both Glasgow branches were in administration and as such the officers of the branch were the full time officials employed by Unison."
Asked if Murphy had declared that Unison had suspended her from holding office on her Labour candidate form, they said: "Our client was not suspended. Her branch had been suspended and placed into administration in August 2005. By 2006 ... our client was a member of the Scottish Executive and Chair of the Scottish Labour Party. She is therefore not obliged to put anything in this section of the form."
Unison said: "We can confirm that a disciplinary investigation took place into the financial conduct of the officers of a group of branches in the Greater Glasgow area, including Ms Murphy's branch. Her membership subsequently lapsed. We have no further comment."