Mr Shorten, who was one of the so-called faceless men responsible for installing Prime Minister Julia Gillard said there had been "no horsetrading" in relation to any possible leadership challenge within Federal Labor ranks.
The workplace relations minister said the leadership speculation was a distraction but he would back Ms Gillard however she chose to deal with it.
Mr Shorten rejected reports he has been approached by backers of Mr Rudd and promised the position of treasurer in return for factional support.
"There's been no offer," he told ABC Television.
Mr Rudd was doing a very good job as foreign minister, Mr Shorten said, jumping to his defence amid heavy criticism during ABC's Q&A program on Monday night.
Mr Shorten dismissed comments made by deputy opposition leader Julie Bishop that many ministers would refuse to serve under Mr Rudd as prime minister.
"It's Liberal propaganda," he said.
Mr Shorten said he was not convinced Mr Rudd would mount a leadership challenge but Ms Gillard had the numbers to survive any leadership spill.
Home Affairs Minister Brendan O'Connor, when asked how long the leadership speculation should go on for, said Ms Gillard and Ms Rudd had spoken about the leadership tensions.
"That conversation has happened and will continue to happen," Mr O'Connor told ABC Television.
"We need to ensure we are united, behind the prime minister, that is critical.
"We need to ensure a unity of purpose."
Mr O'Connor said despite predictions by one Labor MP the party could not win the next election if it stood by Ms Gillard, he was confident support for Labor would rise once people understood the fundamental reforms made by the Gillard government.
The minister said he was fully confident Ms Gillard would be the prime minister at the next election.
