The National Code of Practice for the Construction Industry (the Code) establishes minimum standards businesses must meet to be eligible for Australian Government building and construction work.
The Australian Government Implementation Guidelines for the National Code of Practice for the Construction Industry (the Guidelines), provide supporting detail on Code compliance requirements.
Only parties who are Code compliant can tender to undertake building and construction activities on Australian Government funded projects. This condition applies to the head contractor, subcontractors, project managers, consultants and material suppliers.
Responsibilities of a Head Contractor
The head contractor must:
- be Code compliant in order to tender for Australian Government funded work
- monitor on-site conduct to ensure subcontractors maintain Code compliance
- apply practices consistent with the Code and Guidelines on all new projects once they have submitted their first expression of interest or tender for a project that is subject to the Code and Guidelines.
Achieving 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 Code and Guidelines apply to the project.
Tender documents must either contain copies of the Code and Guidelines as an attachment, be made available on request or advise that the Code and Guidelines can be viewed at www.abcc.gov.au/abcc/NationalCode
Tender schedules must contain an undertaking to apply the Code and Guidelines on the project and any new private construction work.
Contractual documents
Contracts must include clauses that bind subcontractors, material suppliers and consultants to the Code and Guidelines. This includes contracts for major and minor works and purchase orders.
Model tender and contract documentation
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 Code.
The model contract clauses require the head contractor to:
- undertake to comply with the Code and Guidelines and ensure all related construction entities comply with the Code and Guidelines
- ensure that subcontractors, consultants and material suppliers’ workplace arrangements comply with the Code and Guidelines before engaging them on the project
- continue to ensure that all contracts on the project include the requirement to comply with the Code and Guidelines
- agree to allow the Office of the Australian Building and Construction Commissioner (ABCC) to monitor Code compliance on the site and to investigate any breaches of the Code and Guidelines
- acknowledge that the Commonwealth may impose a sanction should they not comply with the Code and Guidelines
- agree to comply with the Code and Guidelines on new privately funded construction projects.
The booklet Model tender and Contract Documentation is available through the ABCC and DEEWR websites (see website addresses listed below).
Workplace arrangements
The head contractor must ensure its workplace arrangements are Code compliant before making an expression of interest or tendering for Australian Government funded building and construction work
DEEWR can assess your workplace arrangements for compliance with the Code and Guidelines. This normally involves an assessment of industrial instruments that cover a contractor. If not compliant, DEEWR will issue a letter identifying which clauses of the industrial instrument are inconsistent with specific provisions of the Code and Guidelines.
If workplace arrangements are not Code compliant, it may be possible to vary the arrangements in order to seek Australian Government work.
Declaration of Compliance
A ’Declaration of Compliance’ can be found in the Model Tender and Contract Clauses booklet. The funding agency may ask the head contractor to submit this document as a means of confirming its commitment to comply with the Code and Guidelines.
The head contractor as part of its monitoring obligation may also ask subcontractors to complete a ’Declaration of Compliance’ statement for their records.
Establishing Code Compliance on site
In order for on site practices to be Code Compliant, head contractors must have satisfactory processes in place to ensure subcontractors, consultants and material suppliers comply with the Code and Guidelines. These include:
- ensuring freedom of association, that is whether or not to belong to a union or employer association is a matter of choice
- employee records are secure and not provided to any third party
- ensuring right of entry to worksites is in accordance with the relevant state and federal laws
- complying with occupational health and safety obligations under the law
- reporting threatened or actual industrial action to the client agency
- 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
- application of the Code and Guidelines is a standing item for site or project meetings
- providing a response to requests for information concerning Code-related matters made by the funding agency, Code Monitoring Group (CMG) and the ABCC
- notifying the ABCC of any alleged breaches, remedial action taken or other Code-related matters within 21 days of becoming aware of the alleged breach
The head contractor should have reporting mechanisms in place that demonstrate these processes are in place and have been practised.
Related entities
The Code applies to a head contractor and all its construction related entities for all Government funded projects.
Related entities refers to a range of corporate structures, including subsidiaries and joint ventures where there are common directorships or influence over other companies through shareholdings.
Material supply contracts under the Code and Guidelines
The Code covers material supply contracts where the supplied material is integral to the construction of the project or relates to prefabrication of made-to-order components to form part of any building, structure or works.
For information, see the Am I a Material Supplier? Fact Sheet (available at www.workplace.gov.au/building).
Sanctions
Sanctions can be applied where a party has failed to meet their obligations under the Code.
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 Code are in accordance with decisions advised by the CMG.
For information, see the A Guide to Sanctions Fact Sheet (available at www.workplace.gov.au/building).
Further information
To make an enquiry or obtain copies of the Code and Guidelines, fact sheets and other reference material, visit the National Code page and Fact Sheets page of the ABCC website or go to:
The Office of the Australian Building and Construction Commissioner
Hotline: 1800 003 338
Website: www.abcc.gov.au
Email: enquiry@abcc.gov.au
Department of Education, Employment and Workplace Relations
National Code Mailbox: building@deewr.gov.au
Code Hotline on 1300 731 293.
Assessment of workplace arrangments for Code compliance:
Go to Code Assessments Online at www.workplace.gov.au/building
Note:
Most building and construction activities undertaken by head contractors will need to conform to the current version of the Guidelines (Blue cover). However, if the funding or formal arrangement was entered into before November 2005 then the previous version of the Guidelines (Orange cover) will normally apply.
Print friendly version:
Code and Guideline Compliance for Head Contractors fact sheet (PDF 149KB)
The information contained in this fact sheet is correct as at 26 February 2008.
Disclaimer: This material is for general information only. You should seek legal advice in relation to your particular circumstances. The Australian Government, its employees and agents do not accept any liability for action taken in reliance on this document and disclaim all liability arising from any error or omission. ABN 68 003 725 098
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