15 January 2018Contractors - Model Clauses
Using the ABCC’s Model Clauses will help you ensure that you comply with the Building Code 2016 (the 2016 Code). You could be breaching the Code if you do not ensure that your subcontractors are Code compliant on Commonwealth funded building work.
As you may be aware, contractors must not award Commonwealth funded building work to a subcontractor if that subcontractor or its related entities have an enterprise agreement that does not meet the requirements of section 11 of the 2016 Code.
Contractors must require subcontractors to produce a copy of an ABCC Letter of Compliance or a completed Self Declaration A or C in respect of the enterprise agreement or other industrial instruments that covers the subcontractor in relation to the building work. The Proof of Eligibility Table (also available on the ABCC website) explains the necessary evidence for a contractor to demonstrate compliance with section 11 of the 2016 Code.
Contractors should also require subcontractors to provide details of any other enterprise agreement made or varied on or after 25 April 2014, that cover the subcontractor or their related entities in respect of building work and to confirm that these enterprise agreements are compliant.
The ABCC issues Letters of Compliance for enterprise agreements made on or after 25 April 2014 that meet the requirements of the 2016 Code.
To ensure these requirements are satisfied, contractors should require subcontractors to complete the Declaration of Compliance contained in the Model Clauses for Tender and Contract Documentation for Contractors and Subcontractors – Model Clauses Type B before they enter into a subcontract for Commonwealth funded building work. As part of this process, subcontractors should outline details of other enterprise agreements made or varied on or after 25 April 2014 that cover the subcontractor or their related entities in respect of building work and reference the evidence they have that these enterprise agreements are compliant.
Updated model clauses
The model clauses have also been updated so they can be tailored to meet the different requirements of directly or indirectly funded Commonwealth funded building work. Contractors are strongly encouraged to use the model clauses to ensure all expressions of interest, tenders and contractual documentation are consistent with the requirements of 2016 Code and the particular requirements in their government contract. As they may differ slightly from project to project, contractors are encouraged to read the Code section of their contract carefully and contact the ABCC if they are unsure which parts of the model clauses to use in their agreements with subcontractors on a particular project. The ABCC is also available to provide presentations to contract administrators as required.
What about privately funded work?
It is important for contractors to remember that the requirements to ensure subcontractors meet the requirements of section 11 of the Code only apply in respect of Commonwealth funded building work. Contractors cannot refuse to engage a subcontractor for privately funded work because they do not meet the requirements of section 11 of the Code.
For further information, advice or assistance please contact the ABCC at 1800 003 338 or enquiry[at]abcc.gov.au.
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