Corporate Plan 2017-18 - HTML version

1. Message from the Commissioner

Nigel Hadgkiss

Photo of Nigel Hadgkiss

As the accountable authority of the Australian Building and Construction Commission (ABCC), I am pleased to present the ABCC’s 2017-18 Corporate Plan. This Corporate Plan covers the periods of 2017-18 to 2020-21 as required under paragraph 35(1)(b) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act).

Following the commencement of the Building and Construction Industry (Improving Productivity) Act 2016 (BCIIP Act) on 2 December 2016, the agency transitioned from the former Fair Work Building and Construction (FWBC) to the ABCC. As the ABCC, the agency has assumed a number of new responsibilities. The Corporate Plan is the ABCC’s principle planning document and has been developed in light of the agency’s revised role, purposes and functions. The plan sets out:

  • the agency’s purpose, and the activities we will pursue to fulfil our purpose;
  • the results we expect to achieve; and
  • the methods by which we will measure our success.

The Corporate Plan is an important part of the ABCC’s planning and reporting framework. The framework strives to demonstrate how the ABCC’s key performance measures are applicable to and carried out by each business unit and staff member in the organisation. It provides oversight to each individual of how their work and the work of their business units contribute to the achievement of agency goals.

We will report against this Corporate Plan in the annual performance statements that form part of the ABCC’s Annual Report, tabled in October each year by the Minister for Employment. Through this annual process we demonstrate our accountability and transparency to the Minister, the Parliament, and the public.

Nigel Hadgkiss signature

Nigel Hadgkiss
Commissioner
Australian Building and Construction Commission

2. Role

The ABCC promotes an improved workplace relations framework to ensure that building work is carried out fairly, efficiently and productively for the benefit of all building industry participants, without distinction, and for the benefit of the Australian economy as a whole.

Our Vision is that all Australian building and construction workplaces are fair, efficient and productive.

Our Mission is to ensure that the rule of law prevails in the Australian building and construction industry.

3. Purpose

In accordance with its responsibilities under the Building and Construction Industry (Improving Productivity) Act 2016 (BCIIP Act), the ABCC:

  1. enforces workplace relations laws in the building and construction industry through the provision of education, assistance and advice, and where necessary, civil penalty litigation in the courts; and
  2. ensures compliance with Building Codes1 by educating the industry, monitoring compliance, and where appropriate, seeking rectification by, or sanctions against, non-compliant contractors.

These purposes are achieved through three core activities:

  • providing education, assistance and advice to building industry participants;
  • undertaking compliance activities;
  • pursuing enforcement activities.

By measuring its success against these activities, the ABCC demonstrates that it achieves its purposes. In doing so, the agency fulfils its role to contribute to an improved workplace relations framework to ensure that building work is carried out fairly, productively and efficiently for all building industry participants, without distinction, and for the benefit of the Australian economy as a whole.

1The ABCC is responsible for monitoring compliance with the Building Code 2013 and the Code for the Tendering and Performance of Building Work 2016 (2016 Code).

4. Operating environment

The Australian building and construction industry is vitally important to the Australian economy and to the wellbeing of the nation. In the 2015-16 financial year, the industry contributed more than $134 billion to the economy, making it the second largest contributor to gross domestic product.2The industry employs more than 1.1 million people, making up nine percent of Australia’s total employment. The building and construction industry is the third largest employer in Australia, behind the health care and retail sectors.3

The mining sector accounts for 46% of the total value of projects currently in construction; however the same sector represents just 25% of the value of projects currently in the pipeline. Conversely, infrastructure projects represent 39% of the total value of projects currently in construction, and 53% of projects in the pipeline. Over the coming years this may signal a continued shift in focus away from major mining projects in remote locations, and a move toward infrastructure projects in more urban areas, with a particular spike in New South Wales and Victoria predicted.4

The March 2017 quarter was the seventh successive quarter in which the construction industry had the highest number of working days lost to industrial disputes by industry, accounting for 40% of total working days lost. 5In the same period an average of 12.1 working days were lost per 1,000 employees in the construction industry, compared with 2.4 days across all industries.6This predisposition toward industrial unrest significantly drives up the cost of building and construction projects in Australia – a cost borne by governments and taxpayers.

As a regulator in the building and construction industry, the ABCC must anticipate changes in the complex and ever-shifting industrial landscape and adapt as a consequence. The ABCC achieves this through regular environmental scans that drive internal decision-making and policy direction. While pursuing a proactive intelligence-led regime, the agency must also remain responsive to those unexpected changes that are driven by unpredictable external factors. The ABCC manages this challenge by promoting an agile and adaptable workforce that is responsive to change and has the means to efficiently deploy resources to where they are most needed.

The ABCC operates within a broader regulatory framework and works with other Commonwealth and State Government agencies that also have a role to play in the building and construction industry. This includes the Fair Work Ombudsman, the Department of Immigration and Border Protection, the Australian Taxation Office, and state and territory work health and safety regulators. The ABCC will refer matters to other agencies that are outside its jurisdiction or are better suited for response by another agency.

Key to the success of the ABCC in its first full reporting period of operations and beyond will be the ongoing training and education of staff in the agency’s new functions, and the implementation of new internal processes. Under the BCIIP Act, the ABCC took responsibility for investigating contraventions of Fair Work Act 2009 provisions relating to misclassification/sham contracting and wages and entitlements in the commercial building and construction industry. This significant new body of work presents the agency with an opportunity to build upon this important role, which was previously undertaken by the Fair Work Ombudsman, with the specialist building industry knowledge and experience that the ABCC’s investigators and lawyers possess.

The implementation of the Building Code 2016 will affect major change in the industry, and brings with it a number of new roles for the ABCC. In addition to the agency’s existing roles related to the Building Code, under the 2016 Code the ABCC’s expanded remit now includes:

  • assessing draft and Fair Work Commission approved enterprise agreements for compliance with the 2016 Code;
  • assessing individual agreement clauses for compliance with the 2016 Code;
  • assessing and approving Workplace Relations Management Plans;
  • collecting a range of information from Government departments that fund Commonwealth construction work, including details of contractual agreements to use only products that comply with relevant Australian standards;
  • monitoring code covered entities’ requirement to advertise for Australian citizens and permanent residents first and demonstrate that no Australian Citizen or permanent resident is suitable for the job before employing a visa holder;
  • monitoring compliance with all applicable laws and 2016 Code requirements relating to security of payments by code covered entities; and
  • pursuing breaches of certain laws as Code breaches, including Workplace Health and Safety and competition laws.

The Commissioner also has a role as a member of the newly established Security of Payments Working Group.

The key challenges that shape the ABCC’s outlook and strategy over the coming four years are:

  • educating the critical mass of building industry participants in such an expansive industry;
  • utilising the full range of agency compliance activities as a proactive driver of behavioural change on construction projects;
  • building the agency’s internal knowledge base of the new regulatory environments within the Code jurisdiction;
  • working collaboratively with State, Territory and other Commonwealth agencies to achieve effective implementation of new functions under the Code that are not related to industrial relations;
  • educating funding entities and code covered entities about their additional responsibilities under the 2016 Code;
  • using Code requirements to influence improved compliance with fragmented Commonwealth, State and Territory security of payment laws;
  • countering the ongoing trend of industrial lawlessness and recidivism perpetuated by some participants in the industry;
  • utilising technology to reduce red tape and facilitate compliance with workplace laws without increasing the regulatory burden on stakeholders;
  • enhancing technology to improve the efficiency of enterprise agreement and workplace relationships management plan assessments;
  • careful management of internal resources given the agency’s expanded jurisdiction; and
  • fulfilling the new functions of the agency in respect of misclassification/sham contracting and wages and entitlements, while maintaining the commitment to existing functions including coercion, right of entry, unlawful industrial action and freedom of association.

These complex factors are considered in formulating the key strategies the ABCC will enact to achieve its purpose over the reporting periods of 2017–18 to 2020–21 covered by this Corporate Plan.

2Australian Bureau of Statistics 2016 Australian System of National Accounts, 2015-16, table 5 cat. No. 5204.0, ABS, Canberra
3Australian Bureau of Statistics 2017 Labour Force, Australia, May 2017, table 4 cat. No. 6291.0.55.003, ABS, Canberra
4Deloitte 2017 Deloitte Access Economics Investment Monitor - March 2017
5Australian Bureau of Statistics 2017 Industrial disputes, Australia, Mar 2017, table 2a cat. No. 6321.0.55.001, ABS, Canberra
6Australian Bureau of Statistics 2017 Industrial disputes, Australia, Mar 2017, table 2b cat. No. 6321.0.55.001, ABS, Canberra

5. Performance

5.1 Mapping of role, purposes and activities

5.2 Overview of activities

The ABCC’s three core activities are:

  1. Education, assistance and advice
    Educate building industry participants about their rights and responsibilities under Australian workplace relations laws and Building Codes.
  2. Compliance
    Conduct activities that assess and improve compliance with Building Codes, including seeking rectification by, or sanctions against, non-compliant contactors.
  3. Enforcement
    Where necessary pursue civil penalty litigation in the courts for alleged breaches of workplace relations law.

These core activities describe the services that the ABCC provides to the building and construction industry in order to achieve its purpose. The primary key performance indicators (KPIs) that assess the ABCC’s delivery of these external-facing services are contained in the Portfolio Budget Statements and this Corporate Plan. Other internal measures are reflected under the same headings in the agency’s Business Plan.

The ABCC’s core activities are supported by two enabling activities:

  1. Information and analysis
    Analyse internal and external information sources to support the agency’s goal of being an intelligence-led organisation.
  2. Corporate services
    Support the business by providing quality corporate services.

The agency’s enabling activities provide the support required to ensure that the business makes strategic decisions based on solid evidence, and has the personnel, training, equipment and resources required to achieve the best possible outcomes. The enabling activities are outlined in the Corporate Plan for context. The KPIs associated with these internal functions are contained in the Business Plan.

The KPIs and targets set out in the ABCC’s 2017–18 Corporate Plan have been selected on the basis of legislative and policy requirements, research, and past performance data. The ABCC’s performance will be evaluated using various methodologies, including data analysis and external surveys. In line with the requirements of the PGPA Act, the ABCC will assess its performance against these targets in the annual performance statement, which will be provided to the Minister for Employment and published in the Annual Report.

5.3 Relationship between core activities

The ABCC’s three core activities are interrelated, with outcomes in each activity affecting the other two. This relationship is demonstrated in Figure 1.

Figure 1 – Relationship between core activities

Activities aimed at educating the industry make up the largest number of activities undertaken by the ABCC. By educating the industry about their workplace rights and responsibilities, the agency endeavours to promote increased rates of compliance and self-regulation among building industry participants.

Since the re-establishment of the ABCC in December 2016, the agency has been responsible for monitoring and ensuring compliance with the payment of wages and entitlements in the commercial building and construction industry. This important body of work is undertaken with a focus on ensuring that individuals and companies have the tools and information available to self-assess compliance and resolve issues. The ABCC also undertakes proactive audits to assess compliance with wages and entitlements.

The ABCC is undertaking new education and compliance activities aimed at improving the industry’s understanding of and compliance with the 2016 Code. This includes the provision of advice related to the compliance of enterprise agreements with the 2016 Code and the approval of workplace relations management plans during government tender processes.

Compliance-based activities represent a smaller number of activities than education; however they also represent more complex and targeted work. The ABCC undertakes proactive site inspections and audits to assess the levels of compliance with Building Codes on building and construction worksites. Where possible, the ABCC addresses non-compliance with Building Codes through voluntary rectification by contractors. Where appropriate, the ABCC will make a recommendation to the Minister that a sanction be imposed. Trends in non-compliance are identified, and these trends inform targeted education strategies. Where non-compliance with Building Codes also indicates that there are potential breaches of workplace relations laws, enforcement actions will be considered.

Although enforcement activities represent the smallest number of the ABCC’s activities, they are also the most complex and resource-dependent. Where there are alleged breaches of workplace relations laws, enforcement options including enforceable undertakings and civil penalty litigation will be pursued. Enforcement outcomes are an important education tool, with civil penalties a key means of general and specific deterrence against unlawful behaviour. Where enforcement outcomes suggest that a code covered entity may be in breach of a Commonwealth Building Code, compliance activities will be considered.

5.4 Key performance indicators

Table of key performance indicators

Core activity KPI Measure Performance Target PBS KPI
      2017-18 2018-19 2019-20 2020-21  
1 1 Percentage of surveyed stakeholders who are satisfied or highly satisfied with the quality and timeliness of advice and assistance provided. 75%7 80% 80% 85% 1
1 2 Number of formal presentations delivered to stakeholders. 150  150  175  200  2
1 3 Number of site visits undertaken nationally 1,000 1,000 1,000 1,000 n/a
1 4 Percentage of surveyed stakeholders who indicate that presentations, advice and/or materials provided by the ABCC have improved their understanding of workplace rights and responsibilities. 75% 80% 80% 85% 3
2 5 Number of compliance activities to improve compliance with Building Codes. 300 300 300 300 4
2 6 Percentage of enterprise agreements assessed for compliance with the Building Code 2016 within two, four and six weeks of receipt.8 Conduct internal benchmarking. Based on internal
benchmarking, determine and
meet appropriate goal.
Improve on 2018/19 figure. Improve on 2019–20 figure. n/a
2 7 Identified non-compliance with Building Codes is addressed through voluntary rectification or recommendation for sanction. 100% 100% 100% 100% n/a
3 8 Legal proceedings in court within 12 months of complaint. 75% 75% 75% 75% 5
7In FWBC’s 2016-17 Corporate Plan, the agency projected an increase in this performance target from 75% in 2016-17 to 80% in 2017-18. Following the transition to the ABCC in December 2016, this target has been retained at 75% for 2017-18.
8In FWBC’s 2016-17 Corporate Plan, the agency committed to benchmark assessments of enterprise agreements for compliance with the Building Code 2013 in 2016-17. Following the transition to the ABCC in December 2016 and the subsequent commencement of the 2016 Code, the benchmarking KPI has been retained in 2017-18 for assessments of enterprise agreements for compliance with the Building Code 2016.

6. Capability

The ABCC has a range of plans and systems in place to achieve its purposes over the four reporting periods covered by this Corporate Plan. The ABCC’s key capability plans ensure that the right human, technology and property resources are deployed, while the agency’s risk management and oversight systems ensure that risks are identified, reported, monitored and controlled.

6.1 Key plans and strategies

Workforce Plan

As a regulator with an important role in the Australian building and construction industry, it is critical that the ABCC engenders a strong leadership culture and empowers staff to deliver excellent service to building industry participants. It is also critical that the agency has the right staff in the right place at the right time, and that those staff are adequately trained and supported.

The Workforce Plan is the key document underpinning the ABCC’s development of a cohesive and high-performing workforce. It identifies current workforce capabilities and forecasts future needs to ensure the agency is able to continue to deliver on its objectives, including employee training and development needs. The Workforce Plan is a live document that evolves with internal and external factors influencing the agency and its workforce.

Driven by the Corporate Services Group, the Workforce Plan is shared and governed by the ABCC’s Executive Team to ensure strategies are in place that integrate and optimise human resources to achieve the ABCC’s purposes over the four years covered by this Corporate Plan.

Information Technology Capability Plan

The ABCC has an Information Technology (IT) Capability Plan in place to support the delivery of agency services and to increase the productivity of staff. The goals of the IT Capability Plan are to:

  • set the business context for the agency’s IT offerings;
  • outline internal and external trends in IT;
  • deliver IT tools at an affordable and sustainable level that allows the business to achieve a high level of performance; and
  • drive efficiencies and continuous improvement in the agency’s operations.

The IT Capability Plan sets out the high level strategies in place to ensure that the ABCC and its employees are equipped with appropriate technology to achieve outcomes. Progress against the IT Capability Plan is reported to the Executive Team monthly.

Property Management Plan

The ABCC’s Property Management Plan strives to promote the efficient, effective, economical and ethical use of Commonwealth resources in the delivery of the agency’s property requirements. The Property Management Plan outlines the current and future needs, risks, gap analysis, and accountability for the agency’s property management.

6.2 Risk management and oversight systems

The ABCC monitors and manages risks that affect the agency’s ability to achieve strategic objectives and successfully carry out operational activities. Risks are considered over the four-year outlook of the Corporate Plan.

The ABCC’s risk management framework establishes processes for managing risk at the strategic and operational levels. It consists of a suite of documents and tools that provide a structured approach to managing risk and embedding a positive risk culture. The main elements are the ABCC Risk Management Policy and Plan, the ABCC Enterprise Risk Register, and internal risk assessment and reporting tools. The framework provides processes for reporting on risk, and the ongoing monitoring and review of risk management activities. The ABCC is committed to managing risk at the most practicable and cost-effective level possible.

The risk management framework meets the agency’s compliance requirements outlined in section 16 of the PGPA Act and the Commonwealth Risk Management Policy, and is aligned with the guidance contained in the Risk Management Standard AS/NZS 31000:2009 – Risk Management – Principles and Guidelines.

The risk management framework ensures that accountability for all levels of risk is assigned to the right manager, at the relevant level of the business. It also provides a mechanism for risk exposures to be escalated to the relevant level of the business for direct oversight, additional action, and appropriate resourcing, if necessary. This is illustrated in Figure 2.

The ABCC assesses its risk maturity annually through the Comcover Benchmarking Survey. Over the next four reporting periods covered by this Corporate Plan, the agency aims to achieve the Risk Maturity Targets outlined in the 2016–17 survey results, and continue to build on the solid foundations already in place.

Business Continuity Plans are in place for each operational area. An Emergency Response Plan and team are in place for each office to assess the impact of events and coordinate activities. The Crisis Management Team is responsible for strategic direction during disasters or damaging events and for activating Business Continuity Plans.

The ABCC’s Fraud Control Plan provides a framework for identifying, reporting, investigating and deterring fraud. Fraud risk assessments are conducted regularly to identify emerging risks and to test existing controls. All staff are required to undertake annual fraud awareness training.

The head of the internal Professional Standards Unit, with the assistance of external service providers, evaluates the ABCC’s systems, controls and practices through a comprehensive program of quality assurance and internal audit reviews. An Internal Audit Strategy and an annual Internal Audit Work Plan are developed to guide these activities.

The Audit Committee also plays a key role in reviewing the agency’s governance arrangements, internal controls and risk environment, and monitoring the internal audit program. This oversight activity allows the Audit Committee to provide independent advice and assurance to the Commissioner and Executive Team.

Figure 2 - Risk management accountability structure

7. Corporate structure and governance

7.1 Corporate structure

The BCIIP Act provides for a Commissioner, appointed by the Minister for Employment, as the accountable authority of the agency. The Commissioner is assisted by three Deputy Commissioners, also appointed by the Minister.

The Deputy Commissioner Legal leads the ABCC’s critical legal work. The Office of the General Counsel reports to the Deputy Commissioner Legal.

The Deputy Commissioner Operations and Code is responsible for operational matters, including leading the administration of the Building Code 2016.  Three regional managers and the Building Code Group report to the Deputy Commissioner Operations and Code.

The Deputy Commissioner WA, SA and NT is responsible for overseeing the inspectorate, stakeholder management, advice and education to industry, and making recommendations for court action in the Western Region, and for assisting the Commissioner with national policy matters.

The Commissioner is also supported by the Office of the Commissioner.

Regional Structure

The ABCC has a regional structure in place. Three Regional Managers, reporting through the Deputy Commissioner Operations and Code, oversee operational and legal activities in their respective Northern (QLD), Eastern (NSW and ACT) and Southern (Vic and Tas) Regions. The Deputy Commissioner WA, SA and NT reports directly to the Commissioner and oversees operational and legal activities in the Western Region (WA, SA and NT).

These multidisciplinary regional groups have carriage of matters from proactive compliance and investigations through to legal proceedings, ensuring that key decisions are made at the earliest opportunity and that staff members are adequately supported to achieve optimal results at all stages of the case lifecycle.

The regional structure was implemented in the 2016-17 reporting period, and 2017-18 is the first full reporting period with the structure in place. Over the four years covered by this Corporate Plan, the agency expects to see the regional structure continue to optimise operations and contribute to the efficient and effective achievement of agency goals. The ABCC’s organisation chart is shown in Figure 3.

The regional structure is supported three central groups led by SES officers: the Building Code Group, the Office of the General Counsel, and the Corporate Services Group.

Building Code Group

Led by the National Manager Building Code, the Building Code Group is responsible for strategy, education, advice and administration relating to the 2013 and 2016 Building Codes. The group has five core functions:

  1. overseeing the strategic management of internal Building Code operations, including audit planning and training ABCC investigators to conduct compliance activities;
  2. providing internal and external advice on Building Code compliance, including appropriateness of rectifications and sanctions;
  3. assessing enterprise agreements for compliance with the Building Code 2016;
  4. monitoring the compliance of government agencies engaging contractors to undertake Commonwealth funded building work with the Building Code 2016; and
  5. developing education materials for internal and external stakeholders on the Building Codes.

Office of the General Counsel

Under the direction of the General Counsel, the legal functions of the regional structure are supported by the Office of the General Counsel, which provides practice management, professional leadership and high level technical advice. The Office of the General Counsel empowers a ‘community of legal practice’ promoting professional mentoring, guidance and development throughout the ABCC.

Corporate Services Group

Reporting to the Chief Operating Officer, the Corporate Group supports the ABCC through the delivery of human resources, information technology, planning and performance, finance, and business support services.

The Human Resources Team manages workforce planning, recruitment and induction, learning and development, performance management, and employee health and wellbeing.

The Finance Team provides financial governance and monthly and annual reporting, monitors procurement, and manages the agency’s budget.

The Information Technology Team ensures that the ABCC has the systems and tools in place to support the agency’s business.

The Planning and Performance Team is responsible for the development and maintenance of the agency’s case management system, the identification of building and construction worksites that fall within the ABCC’s jurisdiction, and the production of reports on agency performance that support continuous improvement in the agency’s strategic decision-making.

The Business Services team provides records management, fleet management, accommodation, and security services.

The ABCC is committed to delivering quality corporate services in the most efficient manner possible. To facilitate this commitment, the agency has in place a number of arrangements with larger agencies for the provision of specialist services. Information Technology infrastructure and services are provided by the Department of Employment through a memorandum of understanding and fee for service arrangement. Payroll and other finance services are provided by the Fair Work Ombudsman through a memorandum of understanding.

Office of the Commissioner

Reporting directly to the Australian Building and Construction Commissioner, the Office of the Commissioner is responsible for a variety of agency functions including media and stakeholder engagement, digital and communications, strategic planning, corporate governance and reporting, parliamentary and executive support, professional standards and internal audit.

Figure 3 - Corporate structure

7.2 Corporate governance

The ABCC’s corporate governance framework comprises the agency’s enabling legislation (the BCIIP Act) and other relevant legislative instruments, policies, strategies, and managerial procedures and practices.

The corporate governance framework determines how the agency exercises authority and delivers outcomes. The framework promotes and upholds the Australian Public Service Values and Code of Conduct.

The ABCC has corporate governance practices that ensure clear lines of accountability and well-defined, effective management of its performance. These practices are overseen and supported by the following frameworks and committees.

Executive Team

The ABCC Executive Team is the agency’s peak decision-making body. It comprises the ABCC Commissioner, Deputy Commissioners, and all SES officers. Key outcomes of the Executive Team’s monthly meetings are communicated to agency staff.

Audit Committee

The ABCC Audit Committee provides independent assurance and assistance to the Commissioner and the Executive Team on the agency’s financial and performance reporting responsibilities, risk oversight and management, and systems of internal control.

The Audit Committee reviews and advises on risk management, control frameworks, external accountability, legislative compliance, internal audit and external audit.

The Audit Committee is also responsible for reviewing and endorsing the annual financial statements.

People Committee

The People Committee’s role is to find innovative solutions to resolve any issues relating to people management and to proactively improve agency engagement and performance through initiatives developed in consultation with the ABCC Executive Team. The People Committee provides a forum for employees to contribute to developing strategies that address people matters within the agency.

The People Committee consists of seven employee representatives and a Chair, appointed by the Commissioner. Employee representatives are selected to ensure representation across all business groups, APS levels, and regions.

Workplace Health and Safety Committee

The Workplace Health and Safety Committee (WHSC) advises the Commissioner and Executive Team on policy matters concerning the health and safety of employees. The WHSC reviews and reports on the implementation of relevant legislation, policies and practices.

The WHSC consists of four employer representatives, including the Chair, who are appointed by the Commissioner, and nine employee representatives elected by staff.

 

Need more information?

For further information, advice or assistance please contact the ABCC at 1800 003 338 or enquiry [at] abcc.gov.au.