The Code sets out two eligibility requirements for contractors seeking to express interest in or tender for Commonwealth funded building work.
They relate to compliance with Section 11 of the Code and exclusion sanctions.
Compliance with Section 11 of the Code
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.
The evidence that each contractor can submit to demonstrate compliance with section 11 differs depending on:
- the type of industrial arrangement (s) the contractor operates under (for example, a modern award , an enterprise agreement or a number of enterprise agreements)
- when each arrangement was made
- when the contractor has tendered/is tendering for Commonwealth funded building work.
To demonstrate that you comply with section 11, submit a Letter of Compliance or an appropriate Self-Declaration unless:
- the Commissioner has given you an exemption from the Code under section 6A or 6B ; or
- the transitional exemption rules apply to your particular enterprise agreement.
Transitional exemptions apply in the following circumstances:
- If you expressed interest in, or tendered for building work between 2 December 2016 and 16 February 2017, you can be awarded the contract for that particular building work up until 29 November 2018 — unless you, as a contractor, are also covered by a non-compliant enterprise agreement made on or after 2 December 2016.
- 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 EOI or tender that you 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.
Letters of Compliance
A Letter of Compliance is an official document that demonstrates a contractor's compliance with the Code.
The ABCC issues Letters of Compliance for enterprise agreements made on or after 25 April 2014 that meet the requirements of the Code (an ABCC determination).
If you're a contractor who requires an ABCC Letter of Compliance, you must apply to the ABCC to have your enterprise agreement assessed. If your enterprise agreement is compliant with the Code, you'll be issued an ABCC Letter of Compliance.
For more information about applying for Letters of Compliance, please refer to the 'How to apply' section further down this page.
It's important to note that Transitional Letters of Compliance and DEEWR -issued Letters of Compliance don't demonstrate a contractor's compliance with Section 11.
For more information, please refer to the Transitional Letters of Compliance section further down this page.
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.
If you're a contractor, you don't need a Letter of Compliance—and may instead rely on a Self-Declaration—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 FW Act .
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 .
Please note: during the transitional period (17 February 2017 to 31 August 2017) some contractors were able to use an ABCC document titled Self-Declaration B, D or E to express interest in or tender for Commonwealth funded building work.
These Self-Declarations are no longer valid for use in current tenders, which means that contractors who previously relied on these now require a Letter of Compliance.
The ABCC can advise you about whether a proposed enterprise agreement (a draft enterprise agreement that hasn't been approved by the FWC ), if made and approved in a certain form, would become an enterprise agreement that meets the requirements of Section 11 of the Code.
We can also advise you about whether individual clauses meet the requirements of Section 11. Individual clauses are much faster to assess than whole agreements, so we can provide you with advice about these relatively quickly.
You can submit individual clauses for ABCC review to email@example.com.
How do I apply for Preliminary Advice or a Letter of Compliance?
We use a two-step assessment process that requires stakeholders (those seeking advice on the agreement) to undertake a preliminary review of any proposed agreement before submitting it to us for consideration.
The preliminary review must be completed before you can apply for Preliminary Advice or a Letter of Compliance.
Step one: Review the Guidance Material
This will help you determine whether the clauses in your agreement meet the requirements of Section 11 of the Code.
Stakeholders must use this guidance material to conduct a preliminary review of their proposed agreement, before submitting it to the ABCC for assessment.
If any clauses in your agreement don't meet the requirements of the Code, we won't be able to issue you a Letter of Compliance for that agreement.
Conducting a preliminary review helps to ensure that your agreement is compliant. This streamlines the assessment process and allows us to get back to you as swiftly as possible.
Step two: Apply for a Letter of Compliance
Once you've completed a preliminary review of your proposed agreement, and consider it likely to be compliant with the requirements under Section 11 of the Code, you may submit it to the ABCC for assessment.
Example: Eligibility to be awarded Commonwealth funded building work
Cool Brick Pty Ltd is a plastering 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.
How long will it take to receive my Preliminary advice or Letter of Compliance?
The time it takes to assess agreements varies depending on the length of the agreement and the extent to which it complies with the Code.
Agreements that are compliant, or mostly compliant, are much quicker to assess—so it's crucial that you conduct a preliminary review of your agreement before you submit it to the ABCC.
ABCC assessment hotline
We know the progress of your enterprise agreement assessment is important to you.
That's why we have a dedicated hotline that you can call to find out how our assessment is progressing.
Please contact 1800 003 338 between 8.30am and 5pm AEST and a dedicated case manager will be pleased to talk to you about the progress status of your application for preliminary advice or Letter of Compliance.
What about transitional Letters of Compliance?
Transitional ABCC Letters of Compliance for enterprise agreements made before 2 December 2016 are no longer valid as the law changed in February 2017.
This means that they can't be used as evidence to express interest in, tender for or be awarded a contract for Commonwealth funded building work.
You can identify whether a Letter of Compliance is transitional and no longer valid because it will state that you are eligible to tender until 29 November 2018.
Letters of compliance issued by the former Department of Education, Employment and Workplace Relations ( DEEWR ) are also no longer valid as they were issued under laws that are no longer in force.
If you previously relied on a transitional letter or DEEWR issued letter, you'll need to apply for an ABCC Letter of Compliance or complete a Self-Declaration (if it is appropriate to your circumstances) as outlined above.
To help you understand what you need to do to, we've developed a proof of eligibility assessment tool, which includes the forms you'll need to demonstrate compliance.
Section 23 of the Code provides that to be eligible for Commonwealth funded building work you mustn't 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 ABC Commissioner may refer breaches to the Minister with recommendations, if any, that a sanction should be imposed.
The Minister in turn can choose to impose an exclusion sanction or a formal warning.
An exclusion sanction is a period during which a contractor isn't permitted to submit an EOI/tender, or be awarded, Commonwealth funded building work.