3 December 2014
Practice Group(s):
Labor, Employment
and Workplace Safety
Federal Government Issues Advanced Release of
Revised Building and Construction Code
Labor, Employment and Workplace Safety Alert
By Duncan Fletcher and Matthew Parker
The Federal Government has issued an advance release of its revised Building and
Construction Industry (Fair and Lawful Building Sites) Code 2014 (Revised Code), which
will come into effect when the Building and Construction Industry (Improving Productivity)
Bill 2014 (Bill) commences as an Act. Once enacted, the Bill will also reestablish the
Australian Building and Construction Commission.
Although the Bill is timetabled to be before the Senate this week, it is not certain that it
will become law this year given current political uncertainties. As this is the last sitting
week of Parliament for 2014, it may not be considered until February 2015.
The Revised Code sets out the Australian Government’s requirements for all building
industry participants tendering for Commonwealth funded building work. Once in force,
contractors will be covered by the Revised Code, prospectively, from the first time they
tender for Commonwealth funded building work and will need to meet the requirements
of the Revised Code to be eligible to work on Commonwealth funded projects.
The Draft Code
On 17 April 2014, the Federal Government released an initial draft version of the Building
and Construction Industry (Fair and Lawful Building Sites) Code 2014 (Draft Code),
which specified various requirements for building industry participants seeking to tender
for Commonwealth funded building work. These requirements largely related to the
content of enterprise agreements, compliance with right of entry laws, dispute resolution
procedures, safety standards and notification requirements for the reestablished
Australian Building and Construction Commission. After considering feedback from
various stakeholders, the Federal Government has now revised this Draft Code.
What's Changed?
The Revised Code has strengthened and enhanced various aspects of the Draft Code.
Significant amendments include:
• applying the content requirements for enterprise agreements (section 11) to enterprise
agreements varied under section 207 of the Fair Work Act 2009 (Cth) (subsection
11(2A)). This amendment is in response to the uncertainty around whether the
requirements of the Draft Code would apply to variations of enterprise agreements.
The Revised Code now makes it clear that it does apply to varied instruments from
the date of variation
• prohibiting reading down clauses in enterprise agreements (section 11A). Section 11A
will ensure that building industry participants to which the Code applies, are not to be
covered by agreements containing clauses which purport to remedy, or render
ineffective, clauses which are inconsistent with section 11 of the Revised Code. For
example, a clause that reads "this clause will not apply in the event that it is contrary
Federal Government Issues Advanced Release of Revised Building and
Construction Code
to the provisions of the Code" will be prohibited. Section 11 outlines the required
content of agreements, as well as prohibited conduct, arrangements and practices
• requiring that a Revised Code covered entity must comply with its obligations under
the Migration Act 1958 (Cth). This means that building industry participants must
strictly comply with immigration laws and visa requirements (subsection 9(4)).
Next Steps for Building Industry Participants Tendering for Commonwealth
Projects
When it commences, the Revised Code will apply in respect of enterprise agreements
made on or after 24 April 2014. This means that from the commencement of the Revised
Code, contractors covered by agreements that were made on or after 24 April 2014, that
do not meet the Revised Code’s content requirements for enterprise agreements, will not
be eligible to tender for or be awarded Commonwealth funded projects. It also appears to
be the Federal Government's intention for the Revised Code to apply to agreements
which were made prior to 24 April 2014 that have been varied after that date.
The Federal Government has also indicated that once the Revised Code is formally
released, the reestablished Australian Building and Construction Commission will be able
to issue a determination as to whether an enterprise agreement meets the requirements
of section 11 of the Revised Code. In the meantime, the Federal Government will
conduct interim assessments of draft agreements on request.
Authors:
Duncan Fletcher
duncan.fletcher@klgates.com
+61.8.9216.0923
Matthew Parker
matthew.parker@klgates.com
+61.2.9513.2491
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