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Code compliant contractors can make or break your next project

Whether you’re for, against or indifferent to industry reform, chances are you’ve heard about big changes made to the Building and Construction Industry Act with amendments being made to the Code for Tendering and Performance of Building Work. Officially taking effect as of the 22nd August this year, these changes have had massive implications to a range of construction and other related entities that have been found to be in violation of the new code. Breaches such as these can cause major complications to company operations and their ability to complete client projects. As such, partnering with a code-compliant company such as Commercial Project Services can be extremely advantageous, especially where budget and time constraints come into play. However, before getting into the nitty gritty of why it is important to engage a compliant contractor, lets first look at what exactly the code means in a little more detail.

 

WHAT IS ‘THE CODE’?

‘The Code for Tendering and Performance of Building Work’ also known as ‘The Building Code 2016,’ is a set of industry level obligations required to be met by certain building contractors and other related industry personnel. Between December 2016 and August this year, the code was brought before Parliament resulting in the reintroduction of the Australian Building and Construction Commission (ABCC) and a revised industry standard through amendments to the previous code. A business or related entity becomes subject to the Building Code 2016 from the time they present an expression of interest or tender for Commonwealth funded works (from the 2nd December 2016-onwards). Once a company is required to comply with the code, they then become a ‘code covered entity’ which means they are thereby bound by the obligations stipulated in the code across all jobs, even in the private sector.

 

WHY DO THEY MATTER TO YOU?

So why does the code matter to you? Although your business might operate in the private sector, engaging a code-covered entity such as Commercial Project Services for your scaffolding and labour requirements can be extremely effective in ensuring security and smooth workflow. As the standards stipulated in the code are of a governmental standard, enlisting a code-compliant company can assist in reining in on all aspects of conduct, procedure and practices throughout the entire construction process.

 

WHAT ARE THE AMENDMENTS TO THE CODE (RELATED TO PRIVATE + COMMONWEALTH-FUNDED PROJECTS)

What is different about the new code? The primary amendments to the code that are valuable and applicable to both private and government funded jobs include:

  • Workplace health and safety laws – must comply with all OHS laws as well as implementing stringent procedures for electing Health and Safety Representatives
  • Restrictions in enterprise agreement terms that limit managerial capacity to attempt to speed-up/streamline productivity
  • Migration – prohibition of engagement of a non-citizen or non-resident without adequately advertising the position to Australian citizens/residents first
  • Obligations to respond to compliance notices issued by the ABCC in a timely manner
  • Restrictions in enterprise agreement terms that conflict with freedom of association principles (defined by the code)
  • Restrictions in enterprise agreement terms that discriminate against certain persons, classes of employees or subcontractors
  • Prohibition of engagement in collusive tendering practices
  • Requirement to include adjudicator referral procedures for subcontractor payment disputes. This must encompass a report to the ABCC and the appropriate funding entity.
  • Prohibitions on coercion or pressuring any entity to support a particular view, product, service, arrangement or the like (such as insurance provider or particular union)
  • Requirement to implement policies for the use of alcohol and other drugs including a testing procedure for jobs that require a Workplace Relations Management Plan.
  • Restrictions in enterprise agreement terms that attempt to loophole the aforementioned clauses (by way of ‘sneaky’ words or trickery)

 

AMENDMENTS RELATED TO COMMONWEALTH-FUNDED JOBS ONLY:

  • Compulsory Workplace Relations Management Plan, encompassing OHS and other related matters with the approval of the ABCC on a case-by-case basis.
  • Reduction of the transitional period in which companies may submit expressions of interest and tender for Commonwealth-funded building work from two years to nine months
  • Restriction of companies with non-2016 Code compliant agreements from being granted Commonwealth-funded work

 

WHAT HAPPENS IF A BUILDING CONTRACTOR BREACHES THE CODE?

What about non-compliance? Businesses and other code covered entities must ensure that all staff and subcontractors take appropriate action to prevent non-compliant behaviour. As such, any breaches or suspected breaches to the code must be formally dealt with via the ABCC. This means: notifying them of the breach, advising of the reasonable steps you propose to rectify the situation and subsequently notifying them of the actual steps that have been taken. If, however, the ABCC are unsatisfied with any stage of this process, they have the authority to issue a failure to comply with recommendations to the Minister for Employment for a formal warning or sanction. When reviewing cases of non-compliance, the Minister will generally consider aspects such as whether the act was intentional or accidental, whether it was a one-off occurrence or ongoing and whether it was internally notified and rectified. As part of the amended code, breaches and non-compliance are now met with increased penalties and, depending on the severity of the breach, the Minister can potentially ban a company entirely from working on federally-funded jobs and sites.

Don’t risk it! Contact Commercial Project Services today…