Eligibility requirements

To be eligible to express interest in or tender for Commonwealth funded building work, contractors must meet two requirements under the Code. The eligibility requirements relate to compliance with Section 11 of the Code and exclusion sanctions. Section 11 of the Code provides that a code covered entity must not be covered by an enterprise agreement in respect of building work that includes certain types of clauses.

How do I demonstrate compliance with the Code?

You need the right evidence to demonstrate your eligibility to tender for Commonwealth funded building work. There are four types of evidence that can be used depending upon your circumstances:

  1. A Letter of Compliance
  2. Self-Declaration A (Webform) (also below)
  3. An exemption from the Code provided by the Commissioner (under section 6A or 6B of the Code). These exemptions are at the discretion of the Commissioner and only available for essential services related to supply of electricity, natural gas, water, waste water or telecommunications and essential services infrastructure.
  4. A transitional exemption.

Use the Proof of Eligibility Tool to work out how you can demonstrate compliance with the Code.

Proof of Eligibility Assessment Tool

Proof of Eligibility Flowchart

Flow chart

Enterprise Agreement

Enterprise agreements are agreements made between employers and employees (unless the enterprise agreement is a Greenfields agreement) about terms and conditions of employment for the employees involved. The Fair Work Commission deals with disputes arising under the terms of agreements. It also assesses and approves enterprise agreements.

The terms of an enterprise agreement must not be less beneficial to employees than the National Employment Standards. The terms must also be better overall than those contained in the relevant modern award. The Fair Work Commission applies a ‘better off overall test’ to the effects of the terms of enterprise agreements when considering whether it will pass the agreement.

There are three types of possible enterprise agreements that may be reached between employers and employees collectively. These are:

  • single enterprise agreements (covering a single enterprise)
  • multi enterprise agreements (covering more than one business or enterprise)
  • Greenfields agreements (covering new enterprises that do not have any employees yet).

Modern Awards

Awards provide pay rates and conditions of employment such as leave entitlements, overtime and shift work, amongst other workplace related conditions. Most modern awards relate to particular industries or occupations. These awards, with the National Employment Standards, provide a minimum safety net of terms and conditions of employment for all national system employees.

Individual Contract

An individual contract or a common law contract is an agreement between an employer and an individual employee, and provides for the terms and conditions of employment that will apply to a particular employee.

Other Lawful Arrangement

This refers to any other valid arrangement between an employer and employee which sets out the terms and conditions of the employment relationship, such as an agreement made under the former Workplace Relations Act 1996 (Cth) or an award-based transitional instrument. Sole traders can also use this option to describe the arrangement they are operating under.

Example: Eligibility to be awarded Commonwealth funded building work

Cool Brick Pty Ltd is a bricklaying company with no related entities. Cool Brick wants to tender for a building project in New South Wales that is entirely funded by the Commonwealth Government. The company has been advised by the head contractor on the project that the Code for the Tendering and Performance of Building Work 2016 (Cth) applies to the project and that Cool Brick needs to provide evidence as part of its tender that it is eligible to be awarded Commonwealth funded building work (that is, that it and its related entities meet the requirements of section 11 of the Code and that it is not subject to an exclusion sanction).

Cool Brick is covered by an enterprise agreement that was made on 22 March 2017. What does Cool Brick need to do to demonstrate that it is eligible to be awarded work on the project?

As Cool Brick is covered by an enterprise agreement made after 2 December 2016, the enterprise agreement must meet the requirements of section 11 of the Code.

Cool Brick will need to submit its enterprise agreement to the ABCC. If the ABCC assesses Cool Brick's agreement as compliant, it will issue Cool Brick with a determination of compliance. Cool Brick can use this determination of compliance as evidence that its agreement meets the requirements of Section 11 and it is eligible to be awarded work on the project.

Self-Declaration A

For contractors, there are some situations in which you don't need to have a Letter of Compliance. Instead, you can rely on a Self-Declaration A. (Use Google Chrome, Internet Explorer or Edge to complete the form)

You don't need a Letter of Compliance—and may instead rely on a Self-Declaration A—if you operate exclusively under one of the following industrial arrangements:

  • A modern award or other lawful workplace arrangement, such as a common law contract.
  • An enterprise agreement that was made before 25 April 2014 and has not since been varied in accordance with Section 207 of the Fair Work Act 2009.

To help you understand what you need to do to comply with Section 11, we've developed a Proof of Eligibility Assessment Tool, which includes the forms you'll need to demonstrate compliance.

Transitional Exemption

If you made an enterprise agreement before 2 December 2016 that applies to you as a contractor, or to a related entity—and the enterprise agreement only applies to building work related to an expression of interest or tender lodged before 2 December 2016—then you do not need a Letter of Compliance for that agreement. For example, an agreement relating to a particular project.

To help you understand what you need to do to comply with Section 11, we've developed a Proof of Eligibility Assessment Tool, which includes the forms you'll need to demonstrate compliance.

Sanctions

Section 23 of the Code provides that to be eligible for Commonwealth funded building work you must not be subject to an exclusion sanction.

While we generally seek voluntary rectification by contractors of breaches in the first instance, the Code provides that the Commissioner may refer breaches to the Minister with recommendations that a sanction should be imposed.

The Minister can choose to impose an exclusion sanction or a formal warning. An exclusion sanction is a period during which a contractor is not permitted to submit an expression of interest or tender or be awarded, Commonwealth funded building work. 

View the exclusion sanctions currently in effect.

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