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Building and Construction Industry Improvement (Consequential and Transitional) Bill 2003

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2002-2003

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

 

 

 

 

 

 

BUILDING AND CONSTRUCTION INDUSTRY IMPROVEMENT (CONSEQUENTIAL AND TRANSITIONAL) BILL 2003

 

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Employment and Workplace Relations, the Honourable Kevin Andrews MP)



BUILDING AND CONSTRUCTION INDUSTRY IMPROVEMENT (CONSEQUENTIAL AND TRANSITIONAL) BILL 2003

 

 

OUTLINE

 

The Building and Construction Industry Improvement Act 2003 (the BCII Act) is the Government’s legislative response to the workplace relations recommendations of the Royal Commission into the Building and Construction Industry.  It supplements, modifies and, in some cases, replaces particular provisions of the Workplace Relations Act 1996 (the WR Act) in order to establish an improved workplace relations framework and culture in the building industry.  The substantive provisions of the BCII Act will operate from dates fixed by proclamation (section 2 of that Act).

 

The Building and Construction Industry Improvement (Consequential and Transitional) Bill 2003 (the Bill) has two main purposes:

·          to make consequential amendments, arising from provisions of the BCII Act, to the WR Act and technical amendments to other Acts (generally to supplement references to the WR Act with references to the BCII Act); and

·          to provide application, saving and transitional provisions concerning the operation of the BCII Act.

 

Part 1 of the Bill deals with preliminary matters including the short title of the Bill and the commencement of the clauses and schedules of the Bill.

 

Part 2 of the Bill contains application provisions for those sections of the BCII Act where the application of those sections upon commencement would otherwise be unclear.  It also provides for the review of building awards within 12 months of the commencement of section 51 of the BCII Act, which provides for further simplification of such awards.  It also contains provisions for the transfer of the records of the Royal Commission into the Building and Construction Industry to the Australian Building and Construction Commissioner.

 

Schedule 1 of the Bill makes consequential amendments to the WR Act in order to accommodate the changes made by the BCII Act and to ensure that references to the BCII Act and the ABC Commissioner are inserted into relevant provisions of the WR Act.

 

Schedule 2 of the Bill amends a number of other Commonwealth Acts to take account of changes made by the BCII Act.

 

FINANCIAL IMPACT STATEMENT

 

The proposals in this Bill are budget neutral.

 

 

 



NOTES ON CLAUSES

 

 

PART 1 - PRELIMINARY

 

Clause 1 - Short Title

 

1.1       This clause is a formal provision specifying the short title of the Act as the Building and Construction Industry Improvement (Consequential and Transitional) Act 2003.

 

Clause 2 - Commencement

 

1.2       Subclause (1) sets out a table which specifies when the various provisions of the Bill are to commence.

 

1.3       Clauses 1 to 10 and clause 12 will commence on the day this Act receives the Royal Assent. 

 

1.4       Clause 11 and schedules 1 and 2 will come into operation on a day to be fixed by Proclamation.  A default commencement date is provided.  If a provision that is subject to commencement on proclamation has not commenced within 6 months of the date that it receives the Royal Assent, it will commence on the first day after that period.

 

Clause 3 - Schedule(s)

 

1.5       This clause provides that each Act specified in a Schedule to this Bill is amended or repealed as set out in the relevant items in that Schedule, and that any other item operates according to its terms.

 



PART 2 - APPLICATION AND TRANSITIONAL PROVISIONS

 

2.1       This Part contains application provisions for Chapters 5, 6, 8, 10 and 11 of the BCII Act.  Where no reference is made in this Part to a provision of the BCII Act, that provision will apply in accordance with its terms from the date of its commencement.

 

Clause 4 - Definitions

 

2.2       This clause defines terms used in Part 2.

 

Clause 5 - Part 1 of Chapter 5 of the BCII Act

 

2.3       This clause sets out the application of Part 1 of Chapter 5 of the BCII Act and provides a mechanism for the review of awards. 

 

2.4       Subclause (1) provides that Part 1 of Chapter 5 will apply in relation to an industrial dispute that the Australian Industrial Relations Commission (AIRC) began to deal with before the commencement of the Part, or begins to deal with after the commencement of the Part.

 

2.5       Subclause (2) requires the AIRC to review all awards within a period of 12 months to ascertain whether they contain provisions that may no longer be included in an award because of Part 1 of Chapter 5 of the BCII Act.  It also allows the AIRC to review awards for this purpose at the same time as it reviews the awards for other purposes. 

 

2.6       After considering appropriate alternatives, the AIRC may vary an award to remove those provisions no longer allowable because of Part 1 of Chapter 5 of the BCII Act (subclause (3)).

 

2.7       At the end of 12 months, any provision which is no longer an allowable award matter due to Part 1 of Chapter 5 will cease to have effect.  The AIRC may vary an award to remove any provision which has ceased to have effect because the end of the transitional period has been reached (subclause (4)).

 

2.8       Subclause (5) defines certain terms for the purposes of this clause.

 

Clause 6 - Other provisions of Chapter 5 of the BCII Act

 

2.9       Sections 53, 54, 57 and 60 of the BCII Act will apply to all agreements, regardless of whether the agreement is made before or after the commencement of those sections (subclauses (1), (3) and (6)).  This will ensure that all agreements certified after the commencement of these provisions are free from extraneous matters and objectionable provisions (as is currently required under the WR Act).  It will also ensure that, after the commencement of these provisions, the AIRC holds a hearing for the certification of every building agreement and, in reaching a decision on certification, considers the terms of any document incorporated into the agreement presented for certification.

 

Sections 55, 56, 58 and 63 of the BCII Act will apply to all agreements made after the commencement of those provisions (subclauses (2), (4), (8)). 

 

·          Under the WR Act, an agreement is made under section 170LJ, 170LL or Division 3 when it is made with one or more organisations of employees.  An agreement is made under section 170LK when it is made with a valid majority of the persons employed at the time whose employment will be subject to the agreement. 

 

2.10     Any agreement reached after the commencement of section 56 will not be able to be certified unless the AIRC is satisfied that the agreement did not result from pattern bargaining conduct occurring before or after the commencement of that provision (subclause (2)).

 

2.11     Subclause (5) provides that section 59 of the BCII Act applies only to agreements made after the 28 th day after the date of its commencement.  Where an agreement is reached after that date, it will be a prerequisite for the certification of the agreement that a bargaining period was initiated in respect of the agreement under section 170MI of the WR Act. 

 

2.12     Section 64 of the BCII Act, which requires representation ballots for the initiation of a bargaining period, will apply to section 170MI notices given after the 28 th day after the date of its commencement (subclause (9)).  This will ensure that parties to an agreement have sufficient time to ensure their agreement meets all the requirements for certification.



2.13     Where the AIRC considers an application under subsection 170MW(2) for the suspension or termination of a bargaining period in relation to a proposed building agreement after the commencement of section 62 of the BCII Act, the AIRC may have regard to the factors listed in that section to determine whether a person is genuinely trying to reach agreement, regardless of whether the application was made before or after the commencement of section 62 (subclause (7)).  The indicators apply to conduct occurring before or after the commencement of section 62 as the obligation to genuinely try to reach agreement already exists under the WR Act and the indicators merely provide additional guidance regarding that obligation.

 

2.14     Injunctions to stop or prevent pattern bargaining will be able to be obtained under section 67 of the BCII Act in respect of conduct engaged in or proposed to be engaged in after the commencement of that section (subclause (10)).

 

2.15     Section 68 of the BCII Act renders certain kinds of agreements (project agreements) unenforceable.  Subclause (11) preserves the enforceability of project agreements made under State industrial laws before the commencement of section 68.  Subclause (11) merely prevents an agreement from being rendered unenforceable by section 68.  It does not grant enforceability to an agreement that would otherwise be unenforceable.

 

2.16     Section 69 of the BCII Act, which renders objectionable provisions void will apply from its commencement to all awards, certified agreements, industrial instruments, agreements or arrangements, regardless of when the instrument, agreement or arrangement was entered into (subclause (12)).

 

2.17     Section 70 of the BCII Act, which provides a mechanism for the removal of objectionable provisions from awards and certified agreements, will apply from commencement to the removal of objectionable provisions from all awards and certified agreements, regardless of when the awards and agreements were made (subclause (13)).

 

2.18     The new penalty levels in section 71 of the BCII Act will apply to any breach of an award, order or agreement that occurs after the commencement of that section, regardless of when the award, order or agreement was made (subclause (14)).

 

Clause 7 - Chapter 6 of the BCII Act

 

2.19     Sections 74, 77, 78, 79, 80, 136 and 137 of the BCII Act will apply to all building industrial action that occurs after the commencement of those sections, regardless of when the course of action began (subclauses (1), (3) and (9)).  After the commencement of those provisions, the occurrence of any building industrial action that is unlawful industrial action (as defined in section 73 of the BCII Act) will be prohibited and the ABC Commissioner may nominate an ABC Inspector to assess the damage resulting from the action occurring from the commencement of section 77.

 

2.20     Section 136 modifies the operation of the strike pay provisions of the WR Act, and imposes higher penalties for breach.  Payments in relation to any building industrial action occurring after the commencement of these provisions will be prohibited under the BCII Act from that time and any claims made for strike pay in respect of industrial action occurring after the commencement of these provisions will also be prohibited (subclause (9)).

                                                                                    

2.21     No specific application provision is required for sections 75 and 134.  These sections both refer to industrial action that “ is threatened, impending or probable” and therefore will apply only to action that is threatened, impending or probable after the commencement of those sections.

 

2.22     Section 76 of the BCII Act, which requires employers to notify the cessation of unlawful industrial action, will apply to all unlawful industrial action that ceases after the commencement of that section, regardless of when the industrial action began (subclause (2)).

 

2.23     Mandatory cooling-off periods imposed by section 81 of the BCII Bill will only apply to industrial action notified after the commencement of that provision (subclause 4)).

 

2.24     Only building industrial action occurring 14 days after the commencement of section 82 will be required to be authorised by a secret ballot in order to be protected action (subclause (5)).  This is to allow sufficient time for parties intending to take protected action to meet the requirements of the secret ballot provisions.  The secret ballot requirements in Division 2 of Part 3 of Chapter 6 of the BCII Act will apply from the commencement of those provisions according to their terms.

 

2.25     Except for subsection (4), section 83 of the BCII Act, which requires industrial action to be preceded by negotiations (where this has been ordered by the AIRC) will apply to building industrial action that occurs after the commencement of that section, regardless of when the course of action began as this is an obligation that currently exists under the WR Act (subclause (6)).  Subsection 83(4) will apply only to action that occurs 14 days after the commencement of that provision, as the same requirements contained in subsections 170MP(1) and (2) form part of the secret ballots provisions in Division 2 of Part 3 of Chapter 6 of the Bill (subclause (7)).

 

2.26     Section 84 of the BCII Act will apply to any organising occurring after the commencement of that section, regardless of when the course of organising may have begun (subclause (8)).

 

2.27     Section 139 of the BCII Act removes the restriction on certain actions in tort that exists under section 166A of the WR Act.  Subclause (10) provides that that restriction is only removed in respect of conduct occurring after the commencement date of that provision.

 

2.28     Subclause (11) provides that the Federal Court is only restrained from granting interlocutory injunctions to prevent a person from instituting or pursuing an action in relation to building industrial action where the building industrial action began after the commencement of that section.

 

Clause 8 - Chapter 8 of the BCII Act

 

2.29     This clause provides that section 176 of the BCII Act will apply to contracts entered into at any time whether before or after the commencement of that section.  Section 176 allows actions that could previously only be brought in the Federal Court to also be brought in the Federal Magistrates’ Court.  The intention of section 176 is merely to improve procedures for access to relief in respect of unfair contracts.  It does not alter the substantive rights or obligations of the parties in any way.

 

Clause 9 - Chapter 10 of the BCII Act

 

Section 211 of the BCII Act requires a Commonwealth building organisation holding money on behalf of members to lodge a statement in the Industrial Registry and with the ABC Commissioner within 90 days after the end of the financial year.  This requirement will apply to any financial year ending after the commencement of section 211 (subclause (1)).

 

2.30     Section 217 of the BCII Act enables the ABC Commissioner to apply to the Federal Court for an order that a specified disqualification period apply to a person and an order directing the person not to engage in specified conduct in relation to any Commonwealth building organisation.  The Federal Court may make such orders in relation to:

·          a person who has been found to have contravened a civil penalty provision in the BCII Act or the WR Act (paragraph 217(1)(a) of the BCII Act); or

·          a person who has, under a State industrial law, at any time been disqualified by a court or other body from holding office in an industrial association (paragraph 217(1)(b) of the BCII Act).

 

2.31     Where paragraph 217(1)(a) applies, subclause (2) provides for orders to be made only where the contravention of a civil penalty provision in the BCII Act or the WR Act occurs after the commencement of section 217.

 

2.32     Where paragraph 217(1)(b) applies, subclause (3) provides for orders to be made only where the disqualification under State industrial law occurs after the commencement of that section and the conduct giving rise to the disqualification also occurred after the commencement of section 217.

 

2.33     Section 218 of the BCII Act will apply from commencement, regardless of when the designated transaction referred to in that section (being a transaction entered into with intention to defeat creditors or with reckless disregard of the interests of one or more creditors) is entered into.  It will, however, operate only once unlawful industrial action has occurred, an order for unlawful action damages has been made and the damages are not paid in full by the specified date.

 

Clause 10 - Chapter 11 of the BCII Act

 

2.34     Subclause (1) provides that Chapter 11 will apply to any demarcation dispute existing after the commencement of that Chapter, regardless of when the dispute began.

 

2.35     Subclause (2) enables the ABC Commissioner, after the commencement of Chapter 11, to apply to the AIRC for a variation of an order made by the AIRC under section 133 of Schedule 1B to the WR Act that is in force and applies to a building organisation, whether or not it applies to any other organisation.

 

Clause 11 - Records of the Building Industry Royal Commission

 

2.36     This clause provides for the transfer of custody of certain records of the Royal Commission into the Building and Construction Industry to the Australian Building and Construction Commissioner (ABC Commissioner) established by clause 11 of the BCII Bill. 

 

2.37     Subclause (1) provides that original records of the Royal Commission, held by the Commonwealth pursuant to subsection 22(2) of the Archives Act 1983 (Archives Act), are transferred into the custody of the ABC Commissioner as if the ABC Commissioner received them in accordance with a direction pursuant to subsection 22(3) of the Archives Act.  The clause has the effect of facilitating the transfer and overcoming delays that would arise from the procedural processes that would normally attach to such a direction.

 

2.38     The records to be transferred to the ABC Commissioner are limited to those that were produced to the Royal Commission and are deemed to be records of the Commonwealth under subsection 22(2) of the Archives Act.  This excludes records that were produced by persons employed or retained by the Royal Commission.  This ensures that internal Royal Commission records are not transferred to the ABC Commissioner.

 

2.39     The transfer is to take place as soon as practicable following commencement of this provision (subclause (2)).

 

2.40     Subclause (3) deals with the manner in which records must be dealt with by the ABC Commissioner.  It allows for records owned by persons other than the Commonwealth to be returned to those persons (paragraph (b)) and ensures that where such records are returned, a copy of the record is provided to the Australian Archives (paragraph (c)).  A sunset clause ensures that the custody of all relevant records is transferred to the Australian Archives within 5 years of the commencement of this section (paragraph (d)).

 

2.41     Subclause (4) provides for the transfer to the ABC Commissioner of an electronic copy of the electronic version of records of the Royal Commission, where the Commonwealth has an electronic version.  The transfer is not contingent on whether the Commonwealth is able to deliver the original of the record under subclause (1).  This deals with the possibility that the record is no longer held by the Commonwealth.

 

2.42     The electronic copy of the electronic version provided to the ABC Commissioner will include any objective coding data attached to that record.  Objective coding data is objective information such as the author and addressee of the record, the date of the record, and the nature of the record.  This data is being provided to assist with the effective management of the records provided to the ABC Commissioner.  Any subjective information attached to the record, such as commentaries or notes about the content of the records made by persons employed or retained by the Royal Commission will not be made available to the ABC Commissioner.

 

2.43     Custody of the electronic version of the records (including both objective and subjective coding data) remains with the Commonwealth.

 

2.44     Subclause (5) enables regulations to be made that would allow the further transfer of records that remain in the possession of the Commonwealth.  This transfer could involve the ABC Commissioner being given either custody of the records, or access to the records (or electronic copies of the records).

 

2.45     Subclause (6) specifies the way in which the ABC Commissioner is taken to have received the records that are transferred to it.  This ensures that the transfer is taken to be for the purpose of the ABC Commissioner performing its functions and powers.  This clarifies the way in which the ABC Commissioner can use and deal with the transferred records.  Paragraph (b) ensures that the transferred records are afforded the same confidentiality as information collected by the ABC Commissioner in the course of its operations.  However, to the extent that the transferred records had already been lawfully made public by other means, their status would not be affected by this subclause.

 

2.46     Subclause (7) specifies that the ABC Commissioner is able to retain the transferred records for as long as the ABC Commissioner considers it desirable for the purpose of exercising its powers and functions.  This will allow the ABC Commissioner to resist requests from the owners of the records for their return, if this is considered necessary for the ABC Commissioner to exercise its powers and functions.  However, the owners will still be able to access the records and make copies.  This subclause will also not prevent the owners of records or other parties from initiating action through the courts to retrieve the records.

 

2.47     Subclause (8) ensures that the protection for individuals against self-incrimination that would usually apply to records of a Royal Commission continues to apply to the transferred records.  This means that the ABC Commissioner’s use of the records against the individuals that provided them to the Royal Commission would be subject to section 6DD of the Royal Commissions Act 1902 .  Section 6DD of the Royal Commissions Act 1902 makes inadmissible the fact of the production of the document or other thing.

 

2.48     Subclause (9) ensures that any rights to claim legal professional privilege over the transferred records continue to exist.  This will allow owners of those records to claim legal professional privilege if the ABC Commissioner seeks to use the records.

 

2.49     Subclause (10) defines terms for the purposes of this clause.

 



 

PART 3 - MISCELLANEOUS

 

Clause 12 - Regulations

 

3.1       This clause allows regulations to be made for the purposes of this Act.

 

 



 

Schedule 1 - amendment of the workplace relations act 1996

 

1.1        Schedule 1 proposes amendments to the WR Act consequential upon the commencement of the BCII Act.

 

1.2       Many of the items will insert references to the BCII Act or the ABC Commissioner into relevant provisions of the WR Act.  Where an item refers to the objects of the BCII Act, the AIRC will only be required to refer to the objects of the BCII Act where the matter under consideration has a relevant connection to building work as defined in the BCII Act.

 

1.3       Some items would make amendments consequential upon the enactment of the BCII Act. For example, items 23 and 24 would add a definition of ‘matter’ to include a proceeding arising under the BCII Act.

 

1.4       A number of the amendments are necessary because processes such as the certification of building agreements or the resolution of building industrial disputes continue to be governed by the WR Act, albeit supplemented and modified by the rules in the BCII Act.  For example, all industrial disputes arise under the WR Act but where the dispute is a building industrial dispute, the AIRC will perform its functions and exercise its powers in relation to that dispute subject to the BCII Act.

 

1.5     Variation of building certified agreements also takes place under the WR Act.  The rules relating to certification of agreements under the BCII Act apply to the variation of those agreements because of paragraph 170MD(3)(b) of the WR Act, which requires the AIRC to be satisfied that it would be required to certify the agreement as varied as if it were a new agreement whose certification was applied for under Part VIB.  There is therefore no need for an express provision.

 

1.6       The schedule would insert a number of substantive provisions into the WR Act:

 

·          Section 45B - which would set out the process and scope for appeals to the Full Bench of the AIRC in relation to a decision or order of a member of the AIRC relating to a matter arising under the BCII Act (item 13);

·          Section 111(1C) - which would ensure that the AIRC may exercise any of the powers listed in section 111(1) of the WR Act in relation to building industrial disputes subject to the BCII Act (item 37).

·          Section 124(1) - which would ensure that the AIRC does not have power to deal with a claim for the making of any payment to employees in relation to a period during which those employees engaged, or engage in industrial action (within the meaning of section 4 of the WR Act) or building industrial action that is constitutionally-connected action (within the meaning of section 71 of the BCII Act) (item 42).

·          Section 299AA - which would provide that Part XIA (which deals with offences) applies in relation to the exercise of powers or functions by the AIRC under the BCII Act (item 52).

 

1.7       For the avoidance of doubt, subsection 170MY(2) will be amended to refer to section 51 of the BCII Act to ensure that the AIRC’s conciliation and arbitration powers in relation to the matters mentioned in subsections 170MX(2) and (3) in relation to the building industry is not limited by section 51 of the BCII Act (item 49).

 

 



Schedule 2 - amendment of other acts

 

2.1       Schedule 2 proposes amendments to other Commonwealth legislation that are consequential to the enactment of the BCII Act.

 

2.2       Item 1 would amend paragraph (a) of Schedule 1 to the Administrative Decisions (Judicial Review) Act 1977 (ADJR Act) to insert a reference to the BCII Act. This amendment would exempt decisions made under the BCII Act from the operation of the ADJR Act.  This is in line with the existing exemption for the WR Act and its predecessors.

 

2.3       Items 3, 4 and 5 would amend the Builders Labourers’ Federation (Cancellation of Registration - Consequential Provisions) Act 1986 (the BLF Act) to insert references to ‘the BCII Act’. Item 2 would insert a definition of the BCII Act into the BLF Act.

 

2.4       Items 6, 7, 10-13 and 14 - 17 would, in part, amend the:

 

·          Christmas Island Act 1958 ;

·          Cocos (Keeling) Islands Act 1955 ;

·          Northern Territory (Self-Government) Act 1978 (NTSG Act); and

·          Seat of Government (Administration) Act 1910 (SGAA Act).

 

so that the BCII Act applies to industrial disputes that occur within each territory, in the same way that the WR Act currently applies.

 

2.5               Items 11 and 16 would amend the:

 

·          NTSG Act; and

·          SGAA Act.

 

so that the BCII Act operates in relation to the appointment of AIRC’s members to tribunals, in the same way that the WR Act does.

 

2.7       Item 8 would insert new paragraph 4(4)(aa) into the Jurisdiction of Courts (Cross-vesting) Act 1987 so that section 4 of that Act, which deals with additional jurisdiction of certain courts, would not apply in relation to matters arising under the BCII Act. 

 

2.8       Item 9 would insert new paragraphs 42A(7)(a) and (b) of the Naval Defence Act 1910 , which deal with the employment conditions of civilians, to make it clear that the provisions do not affect the application of the BCII Act to the employment of these individuals. This reflects how the WR Act currently applies.