Chris Back, a veterinarian, said a taxi driver used by Animals Australia made the payments.
One of the workers was later beaten-up by co-workers and his wife raped, the senator told a senate hearing in Canberra on Wednesday.
"There are now serious questions over the methods used to obtain footage by Animals Australia," Senator Back said of visits to abattoirs in Sumatra and Java by the organisation`s campaign director Lyn White.
The footage was broadcast as part of a Four Corners report into animal cruelty at Indonesia abattoirs that led to the federal government imposing a temporary ban on live exports from Australia.
Ms White denied any knowledge of the payments.
"No, there was no payment at all," Ms White told reporters outside the hearing, adding it was the first time she had heard the allegation that meat workers had been paid to abuse cattle.
"It doesn`t surprise me that workers would suggest that they were given some sort of inducement, they`ve obviously faced repercussions for allowing us to have access to abattoirs."
Ms White accused Senator Back of making a "clear attempt to distract" the Senate committee from its task of investigating animal welfare issues in Australia`s live export markets.
Earlier, Senator Back quizzed Ms White about the payments using information he had received from an un-named Australian consultant in Indonesia.
He said a taxi driver, used by Ms White, had paid meat workers to whip or kick cattle in front of a cameraman.
One worker who was paid 150,000 rupiah - about eight days` salary - was asked to kick an animal in the head.
Since then the worker had been beaten-up by his co-workers "on a daily basis" and his wife and daughter raped, Senator Back told the hearing.
Head of the Northern Territory Cattlemen`s Association Luke Bowen says there may be some truth to claims that Animals Australia paid Indonesian meat workers to abuse cattle.
Mr Bowen, while observing the loading of the first post-ban shipment of cattle bound for Indonesia, said the industry had known for some time that meat workers had been paid to allow Animals Australia into the abattoirs.
He said the latest allegations had only just emerged.
"It sounds like there may be some truth in it," he said in Darwin on Wednesday.
"I`ve heard second hand that there are signed affidavits from the fellas in Indonesia saying they were paid to actually kick and abuse those animals."
Mr Bowen said Australians needed to be mindful that many animal advocacy groups had broader agendas in mind.
"For some of these animal lib (liberation) groups, this is just a convenient vehicle as a general sort of attack on livestock industries," he said.
"If it is true, it is outrageous.
"If it is true, it is actually shameful."
"A lot of these groups believe eating meat and wearing leather is exploitation of animals and they want to see (the livestock industry) gone."
Senator Back said the incident happened at the Mabar abattoir in Sumatra.
A "very reliable source" who visited the abattoir some days later had told him that a "white lady and a bule (white male foreigner) and a driver came to the abattoir".
"The cameraman and the driver came to him and offered him (the abattoir worker) 150,000 rupiah to kick the animal in the head repeatedly until they got the film they wanted," the senator told the hearing.
"He did not want to do this for religious reasons but his family needed money, so he did.
"He kicked it a number of times and then stopped. They asked him to keep going and he did."
Ms White rejected the allegation, describing it as "very offensive".
"Not only did I not have any knowledge or association, I don`t believe it`s correct, senator," she said.
(U.A050/ H-AK)
Editor: Priyambodo RH
Copyright © ANTARA 2011
