Mr Shorten's call for a broader party comes a day after the NSW Labor conference defeated a bid to give Labor's rank and file members a direct role in selecting upper house candidates because it would reduce union power.

Mr Shorten will tell the NSW Labor conference on Sunday he wants a party "where your membership card entitles you to genuine participation in our party; in the choice of our leaders, our policies and our future direction".

He will say NSW Labor had set the direction but now needed to complete the job. In April, Mr Shorten called for compulsory union membership to be dropped as a prerequisite for joining Labor.

The NSW conference on Saturday voted to allow the direct election of the NSW party leader for the first time since 1939, following the success of federal Labor. After the March 2015 poll, NSW Labor members will have an equal say with caucus in selecting the leader.

Senator John Faulkner had championed a failed bid to break the "farcical system" of selecting upper house candidates, which he said had delivered Eddie Obeid, declared corrupt by the Independent Commission Against Corruption, to the NSW parliament.

Mr Faulkner argued thousands more union members would have a vote under a direct election system, rather than a small number of powerful union secretaries.

NSW legislative council member Luke Foley also backed the move away from factional selection, saying it was "pro-unionist" to give union members who are Labor members a direct vote.

But NSW Labor's right-wing general secretary Jamie Clements opposed it, saying Mr Obeid "did not have the backing or support of any trade union – he was an ethnic branch stacker with wealth".

The challenge of how to scrub off the stain of corruption was the dominant theme at the meeting at Sydney's Town Hall.

NSW Opposition leader John Robertson delivered a rallying call to NSW Labor ahead of the 2015 election. Highlighting a fight for jobs and training next March, he unveiled a policy imposing a ratio of 15 per cent of jobs on major government construction projects to be filled by apprentices, trainees and the long-term unemployed.

Labor ministers, staff and departments would also be banned from meeting with third-party lobbyists, Mr Robertson said.

He repeated his call for Mike Baird to pass legislation to allow full public funding of elections, to make 2015 the "cleanest ever".

Deputy Opposition leader Linda Burney said the direct election of the state leader would be an important step in fixing NSW Labor's reputation.

"We have to not only regain the trust and respect of our members but regain trust and respect across the community," Ms Burney said.