Australia: New enterprise agreements to be assessed for Building Code compliance by FWBC

Fair Work Building and Construction (FWBC) will be responsible for assessing whether any enterprise agreements made on or after 18 May 2016 comply with the Building Code 2013. Contractors whose enterprise agreements are non-compliant will be unable to bid for Commonwealth-funded building work which is procured on or after Friday 1 June 2016.

These changes do not affect existing projects, or projects for which the procurement process is already underway prior to 1 June 2016.

The changes are part of the revised Supporting Guidelines for the Building Code 2013 issued by the Minister of Employment on 6 May 2016 which also allows the FWBC Director to recommend to the Employment Minister an exclusion sanction for contractors whose non-compliance with the Code cannot be satisfactorily rectified.

The revised Supporting Guidelines require contractors bidding for future Commonwealth funded building work to confirm they are not covered by an enterprise agreement that is inconsistent with the Building Code 2013. This is done via a letter of compliance from the FWBC.

According to the factsheet released by the FWBC, the Minister's letter to the FWBC transferring the role of assessment from the Department of Employment and Workplace Relations has rescinded the previous practice of deeming registered enterprise agreements automatically compliant with the Building Code 2013.  

You should act now to ensure any draft enterprise agreements post 18 May 2016 will comply with the Building Code 2013.

Further, code compliance has become a significant bargaining issue in recent negotiations for Enterprise Agreements in the construction industry. If you think that Code issues are likely to impact on your bargaining seek advice on your industrial strategy early.

Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this bulletin. Persons listed may not be admitted in all states and territories.