The National Code sets minimum standards that businesses must meet to be eligible for certain Australian Government building and construction work.
The National Code Implementation Guidelines provide supporting detail on compliance requirements.
See other ABCC fact sheets to determine when the National Code applies and which Guidelines to use.
This fact sheet applies to all projects that were the subject of an expression of interest or tender let for the first time on or after 1 August 2009.
Responsibilities of a head contractor
The head contractor must:
- have workplace arrangements that are compliant with the National Code of Practice for the Construction Industry (National Code) and Australian Government Implementation Guidelines for the National Code (Guidelines)
- monitor on-site conduct to ensure subcontractors maintain compliance with the National Code and Guidelines
- apply practices consistent with the National Code and Guidelines on all new projects. Until a company tenders on a project subject to the 2009 Guidelines they will be expected to maintain compliance with earlier versions of the Guidelines.
Achieving National Code compliance prior to commencement of the project
Tender documents and advertisements calling for expressions of interest
Public tender material such as advertisements, expressions of interest and requests for tender must contain advice that the National Code and Guidelines apply to the project.
‘The National Code of Practice for the Construction Industry, in accordance with the Australian Government Implementation Guidelines for the National Code of Practice for the Construction Industry, August 2009, applies to this project. This document can be viewed at the Australian Government website at www.deewr.gov.au/building.’
Tender schedules must contain an undertaking to apply the National Code and Guidelines on the project and on any new private construction work.
Tender schedules must contain an undertaking to apply the National Code and Guidelines on the project and on any new private construction work.
Preference may be given to tenderers that have a demonstrated commitment to:
- adding and/or retaining trainees and apprentices
- increasing participation of women in all aspects of the industry
- promoting employment and training opportunities for Indigenous Australians in regions where significant indigenous populations exist.
Contractual documents
Contracts must include clauses that bind subcontractors and consultants to the National Code and Guidelines. This includes contracts for major works, minor works and purchase orders.
Model tender and contract documentation (model clauses)
Model clauses have been prepared by the Department of Education, Employment and Workplace Relations (DEEWR) for use within tender and contract documents. Head contractors should use these clauses when preparing tenders and contracts for building and construction projects covered by the National Code.
The model clauses require the head contractor to:
- undertake to comply with the National Code and Guidelines
- ensure their related construction entities comply with the National Code and Guidelines
- ensure that subcontractors’ and consultants’ workplace arrangements comply with the National Code and Guidelines before engaging them on the project
- ensure all contracts on the project include the requirement to comply with the National Code and Guidelines
- allow the ABCC to monitor National Code compliance on the site and to investigate any breaches of the National Code and Guidelines
- acknowledge that the Commonwealth may impose a sanction should the head contractor not comply with the National Code and Guidelines
- comply with the National Code and Guidelines on new privately funded construction projects.
The booklet Model Tender and Contract Documentation is available through the ABCC and DEEWR websites.
Workplace arrangements
The head contractor must ensure its workplace arrangements are National Code compliant before making an expression of interest or tendering for Australian Government funded building and construction work. The Fair Work Act 2009 encourages employees to collectively bargain at the enterprise level.
DEEWR can assess your workplace arrangements for compliance with the National Code and Guidelines. This normally involves an assessment of industrial instruments that cover a contractor.
The use of unregistered written agreements, other than common law agreements made between the employer and an individual employee, is inconsistent with the National Code and Guidelines. The entity or entities to which such an agreement applies will be deemed non-compliant with the National Code and Guidelines.
Establishing National Code compliance on site
Head contractors must proactively ensure compliance with the National Code and Guidelines on site. This includes:
- ensuring compliance with the National Code and Guidelines from subcontractors before doing business with them
- ensuring freedom of association is properly respected
- ensuring right of entry to worksites is in accordance with the relevant state and federal laws
- complying with occupational health and safety obligations in accordance with state and federal law
- reporting threatened or actual industrial action to the funding entity
- prohibiting any attempt to unduly influence subcontractors to have particular workplace arrangements or to make over-award payments
- prohibiting the negotiation of arrangements that restrict the efficient performance of work on the project
- ensuring that the application of the National Code and Guidelines by subcontractors is a standing item for site or project meetings
- providing a response to requests for information concerning National Code-related matters made by the funding entity, Code Monitoring Group (CMG) and the ABCC
- notifying the CMG of any alleged National Code breaches, remedial action taken or other National Code-related matters within 21 days of becoming aware of them.
The head contractor should have reporting mechanisms that demonstrate these processes are in place and have been practised. Their contractual arrangements with subcontractors must contain suitable provisions to comply with the National Code and Guidelines.
With regard to compliance of subcontractors, a completed Declaration of Compliance from a subcontractor is not sufficient evidence of meeting National Code requirements. Subcontractors are directed to Section 5.4 of the 2009 Guidelines.
Related entities
The National Code applies to a head contractor and all its construction related entities for all government funded projects. ‘Related entities’ can refer to a range of corporate structures. These include subsidiaries and joint ventures where there are common directorships or influence over other companies through shareholdings.
Sanctions
Sanctions can be applied where a party has failed to meet their obligations under the National Code and Guidelines. Sanctions can include a formal warning and, in more serious cases, a preclusion from tendering for Australian Government funded construction projects. Sanctions applied under the National Code are in accordance with decisions advised by the CMG.
Australian Government agencies will no longer be able to enter into a contract with a contractor if the contractor has a judicial decision against them relating to employee entitlements and it has not paid the claim. In addition, an assessment will be made to confirm whether a tenderer has any court, tribunal, industrial relations commission or Fair Work Australia findings, orders or penalties awarded against it in the previous two years.
Occupational health and safety
To be eligible to tender for Australian Government funded projects over $3 million, principal contractors must be accredited with the Australian Government Building and Construction OHS Accreditation Scheme (Scheme) administered by the Office of the Federal Safety Commissioner. The Scheme is separate to the National Code and Guidelines.
Head contractors must establish site-specific OHS management plans before work commences on Australian Government funded construction projects.