ABCC update: Government moves amendment to improve Building Code 2016

ABCC update: Government moves amendment to improve Building Code 2016

In a move that will be welcomed by the majority of industry, the Turnbull Government has today moved an amendment in the House of Representatives to reduce the current two-year transition period applying to the Code for the Tendering and Performance of Building Work 2016 (the Code) to nine months. If passed, it would reduce the time available for contractors who made an enterprise agreement prior to 2 December 2016 to become compliant with the Code – from 29 November 2018 to 1 September 2017.

The amendment also clarifies that whilst contractors who entered into a non-compliant agreement prior to 2 December 2016 are still eligible to tender for federally funded work until 1 September 2017, they will not be eligible to be awarded the contract until they have code compliant arrangements in place.

It is understood that Senator Hinch, whose amendment was responsible for the current two-year transitional period, is a key driver behind the move following feedback from industry. Senator Hinch told The Australian that:

“Over the summer break, I spoke to a lot of people, subcontractors and middle-sized construction companies … They told me the legislation was killing them. My view is that I listen to people, and that’s what I did. I contacted Malcolm Turnbull and told him we need to look at this again”.

It is understood that the amendment has support from a range of crossbench senators and is likely to be passed.

Master Builders welcomes the move, which is aimed at ensuring that the ABCC and the Code are as effective as originally intended.

The amendment will also assist in addressing a number of the unintended adverse consequences created by the current two-year transition period, which effectively rewarded contractors who ignored the Government’s clear and unambiguous advice regarding agreement content requirements that would be applicable under the Code, and punished contractors that refused to enter into such agreements.

From a practical perspective the amendment will mean those contractors who entered into CFMEU Pattern EBA 2016-2018 prior to 2 December 2016, have to either formally terminate, or vary the agreement to be compliant with the Code, by 1 September 2017 should they wish to remain eligible to tender for federally funded work.

Whilst Master Builders continues to make itself available to engage with the CFMEU to expedite a Building Code 2016-compliant solution for the industry, in the interim, it will continue to advise members on the range of alternatives available to employers and employees.

Members seeking further information are encouraged to contact the IR Department on (03) 9411 4560.

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