Victorian Upper House whip stands down after corruption allegations

Victorian Labor MP Jaclyn Symes has been elected to replace embattled MP Cesar Melhem as the state government's Legislative Council Whip.

Earlier, Premier Daniel Andrews said Mr Melhem resigned over the phone last night, with the resignation to be confirmed in a caucus meeting today.

In a statement, Mr Melhem said he decided to stand down because he feared media speculation about his role could become a distraction for the state government.

"I again deny any allegation of wrongdoing made against me at the trade union royal commission," he said.

"I have always acted in the best interests of working people and will continue to do so."

Mr Melhem was under pressure to step down after the Trade Union Royal Commission was told of allegations of a deal with a cleaning company that short-changed workers of $2 million in penalty rates in return for cash payments to the Australian Workers Union when he was their state secretary.

The premier would not comment on the allegations last week, while the State Opposition called for Mr Melhem to be sacked.