Industry Update

Enterprise Agreements and a Federal Building Code: Update

On 17 April 2014, Employment Minister Eric Abetz released the Federal Government’s proposed new Building Code. It aims to use the Government’s purchasing power to promote workplace arrangements that drive productivity, flexibility and compliance with the law.

The Government has indicated that the revised Code will reflect to a substantial degree the 2006 Commonwealth Guidelines, but more importantly the Code largely mirrors the Guidelines recently introduced by the States of Victoria, Queensland and New South Wales. 

The new Building Code will come into effect if the Building and Construction Industry (Improving Productivity) Bill 2014 commences as an Act. The Department of Employment currently has carriage of preparing for the potential introduction of this law.

Fair Work Building and Construction (FWBC) is responsible for monitoring compliance with the current 2013 Building Code.  If the new Building Code becomes law, the Australian Building and Construction Commission (ABCC) will be responsible for monitoring it.

The new Building Code will have a particular focus on the tender stage of projects.  This will distinguish the future ABCC’s role from that of the current FWBC’s role.

On 28 November 2014, Minister Abetz released a revised version of the Code, the Revised Fair and Lawful Building Sites Code 2014. Among the revisions are changes to make it clearer that:

  • The Code applies to variations of enterprise agreements; and
  • Contractors must strictly comply with immigration laws and visa requirements.

Consistent with the earlier version released on 17 April 2014, failure of contractors to abide by the Code may result in them losing the ability to tender for Federal Government funded work.

The Government has indicated that the new Code will apply to EBA negotiations in the building industry. Subcontractors who are engaged on Commonwealth-funded building projects will also be required to have agreements that are Code compliant. 

Contractors who tender for Federal Government work will become bound by the Code even if their tender is unsuccessful.

Once a contractor is covered by the new Code, they will have to adhere to it on future privately funded work.

Under the proposed Code, if an enterprise agreement is made after 24 April 2014 which is not Code compliant, a contractor will not be able to tender for Federal Government funded work. 

As such, all contractors should carefully consider the impact of the Code on the terms of their enterprise agreements before proceeding.

If you want to know more about the Code before the legislation is passed you can contact the Department of Employment on their National Code Hotline – 1300 731 293 or email them at building [at] Information is also available on their website.

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