Understanding the Building Code for Contractors – LegalVision

Are you a building contractor or working on a building site? It is important you understand the requirements of the Building Code. The Commonwealth Building Code 2013 came into effect on 1 February 2013 and set out the standard by the Australian Government Fair Work Building and Construction Department (FWBC) about lawful workplace relations on building sites. The Code aims to improve productivity, flexibility and upholds standards of workplace relations regarding on-site practices. The Commonwealth Building Code should not be confused with the Building Code of Australia, which the Australian Building Codes Board produces, and provides a uniform set of technical provisions for the construction of buildings.

Who does the Building Code Apply to?

The Building Code not only applies to building contractors but also to participants who have tendered for Commonwealth funded building work. The definition includes suppliers performing work on the site and privately funded projects. If you are a building contractor who is subject to the Building Code, you must comply with the Code at all times, even if a project has not received Australian Government funding.

Building industry participants must ensure that the obligations arising from the Building Code apply down the contractual chain. This means subcontractors engaged on Australian Government funded work must act in a manner consistent with the Code at all times. Tendering of work by subcontractors automatically binds them to the Code.

Requirements of the Building Code

On-site practices play a crucial role in meeting the requirements of the Code. These practices include good faith bargaining, the right of entry, sham contracting and freedom of association.

The Code sets out a range of obligations and requirements for building contractors. These obligations include:

  • Complying with all building and construction laws, including the Fair Work (Building Industry) Act 2012 and the Fair Work Act 2009 (FW Act);
  • Ensuring contractors and not coerced to make an over-award payment or contribute to a particular superannuation fund;
  • Ensuring all contractors comply with the Code;
  • Reporting any breach of the Code;
  • Adopting policies to promote and protect freedom of association, such as joining a union;
  • Not bargaining for agreements that cannot be approved under designated building law;
  • Proactively ensuring the Code is complied with by subcontractors;
  • Not engaging in industrial action and reporting any threat of industrial action to the FWBC Director as soon as a threat occurs.

In mid-2014, the Federal Government published a new Federal Building and Construction Code (Draft Code). Eric Abetz, the Minister for Employment at the time, published the code in advance to enable contractors who intended to tender for Commonwealth-funded building work to be aware of upcoming changes to their enterprise agreements. The Draft Code will come into force when the Building and Construction Industry (Improving Productivity) Bill 2013 commences as an Act. When the Act commences, the provisions of the Code will apply in respect of enterprise agreements made on or after 24 April 2014.

If you have any questions about reviewing your building contract or understanding your obligations under the Building Code, head to: www.legalvision.com.au/need-contract-lawyer/or call us on 1300 544 755.

This is the fourth edition of Spotcap Specialists –  a content series which features advice and tips from experts in a range of fields to support small business growth.

This post was written by Anthony Lieu, strategist and Lawyer at LegalVision. Having founded a number of startups, Anthony has a keen interest in startup law and scaling fast-growing businesses.

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