Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
National Code of Practice for Building and Construction Industry [30 May 1997]

Commonwealth and State/Territory Labour Ministers today unanimously agreed to the industrial relations components of a National Code of Practice for the Building and Construction Industry.

The Code of Practice, being developed by Labour Ministers and Construction Ministers will apply to all Commonwealth and State/Territory Government construction projects, with the private sector encouraged to adopt the Code on a voluntary basis.

Commenting on the Code, the Federal Minister for Industrial Relations, the Hon Peter Reith MP, said that it establishes standards of behaviour which all parties seeking to do business with governments, or work on government projects, will be required to comply with Governments will use their collective purchasing power to promote reform in the industry.

The National Code will be consistent with codes of practice which exist, or are developed, within States and Territories.

The industrial relations component of the Code covers issues such as complying with awards and legal obligations relating to employment, workplace arrangements, over award payments, project agreements, freedom of association, dispute settlement procedures, strike pay and the impact of industrial disputes.

Governments have agreed to establish effective compliance and enforcement mechanisms to apply to the Code subject to agreed principles. Sanctions include:

. reporting of a breach of the Code to an appropriate law enforcement agency; reduction in the number of tendering opportunities; preclusion from tendering for any Government work for a specified period; publication of the details of the breach; full use of existing remedies and sanctions under existing legislation particularly under federal and state industrial relations legislation.

The industrial relations elements will now be merged with the construction elements of the National Code and it is expected that the full Code will be released in early August, following a meeting of Commonwealth and State/Territory Construction Ministers.

A copy of the industrial relations components of the National Code of Practice is attached.

For further information contact Nick Hordern on 06 277 7320 or 0419 423 756.



The National Code expresses the principles which Commonwealth, State and Territory Governments agree should underpin industrial relations on Government construction projects.

The private sector is to be encouraged to adopt the code on a voluntary basis.

Any party wishing to do business with governments or work on government construction projects will be required to comply with all aspects of the Code applicable to their activities

. the term party in the Code includes but is not limited to clients, principal contractors, subcontractors, suppliers, consultants, employees, unions - their officials, employees and members and industry associations whilst undertaking a representative role

Adoption of the Code expresses a commitment to deal only with organisations and personnel whose standards and behaviour conform with the principles expressed in the code. In particular coercion of any form is prohibited.

Individual governments will be able to maintain existing codes or develop codes to suit the priorities and circumstances relevant to particular jurisdictions. It is agreed that existing codes or new codes developed will be consistent with the principles established in the National Code. Where a relevant State/Territory) Code provides for provisions in addition to the National Code those provisions will apply in that State/Territory. The National Code provides the minimum level of compliance.

Awards and legal obligations relating to employment

All parties must comply with the provisions of applicable

. awards and workplace arrangements which have been certified, registered or otherwise approved under the relevant industrial relations legislation;

. legislative requirements.

Workplace Arrangements

Workplace arrangements which reflect the needs of the enterprise are important elements in achieving continuous improvement and best practice.

The content of the workplace arrangements are a matter for the parties to those arrangements, subject to them meeting legislative requirements. However they may encompass:

. improved OHS and rehabilitation practices;

. training and skill formation strategies;

. multi skilling;

. flexible work practices, for example in relation to working time.

A party must not, directly or indirectly, pressure or coerce another party to enter into, or to vary or to terminate a workplace arrangement. Nor may they pressure or coerce them about the parties to and/or the contents or the form of their workplace arrangements. This does not prevent action sanctioned by relevant industrial relations legislation.

Overaward payments

"Overaward payment" is defined to mean any payment and/or benefit above that set out in the relevant award, registered agreement and/or legislation. This includes payments provided for in workplace arrangements.

Decisions on over award payments, including superannuation, redundancy and workers' compensation insurance, shall be made by the individual employer to suit the needs of the enterprise. No employer may be compelled to pay benefits above that prescribed in the relevant workers compensation legislation.

A party must not, directly or indirectly, coerce or pressure another party to make over award payments. No employer may be compelled to contribute to any particular redundancy or superannuation fund, or similar body unless that there is an award or legal requirement to do so. This does not prevent action sanctioned by relevant industrial relations legislation.

Project Agreements

Project agreements will only be appropriate for major contracts. Accordingly project agreements incorporating site-wide payments, conditions or benefits may be negotiated where the strategy has first been authorised by the Principal.

The integrity of individual enterprise agreements must be maintained. This means project agreements cannot override the workplace arrangements of individual contractors, subcontractors, consultants and suppliers, nor may they provide conditions which by their nature have effect beyond the duration of the project, such as, for example, redundancy pay and superannuation contributions. While there may be provisions in a relevant workplace arrangement that enables the parties to the arrangement to encompass provisions in a project agreement, there shall be no double counting of "over award" payments.

There shall be no flow on of the provisions of project agreements.

Such agreements should he developed, where possible, in consultation with the subcontractors working on the project. The agreements shall be certified or otherwise approved under the relevant industrial relations legislation.

Freedom of Association

All parties have the right to freedom of association. This means that parties are free to join or not to join industrial associations of their choice and that they are not to be discriminated against or victimised on the grounds of membership or non membership of an industrial association. A person cannot be forced to pay a fee to an organisation if not a member.

Dispute Settlement

All parties are required to make every effort to resolve grievances or disputes with their employees and applicable unions at the enterprise level, in accordance with the procedure outlined in the relevant award or workplace arrangements.

Strike Pay

No payment shall be made to employees for time spent engaged in industrial action, unless payment is legally required or properly authorised by an industrial tribunal (where this is permitted by relevant industrial legislation).

Industrial Impacts

The client of the principal contractor shall be advised during the progress of the work, and at the earliest opportunity, of any industrial relations or OHSR matter which may have an impact on the construction program, the principal contact, other related contracts or project costs.


Each jurisdiction will establish effective compliance and enforcement mechanisms to apply to the national code subject to the following principles:

. sanctions are based on the right of the client to choose who they do business with

. the type of sanctions that is to be applied for an infringement will vary according to the nature of the specific breach and other circumstances

. in the case of non compliance by a party the sanction may include but not be limited to

- the reporting of the breach to an appropriate statutory body or law enforcement agency;

- a formal warning that continued non- compliance will lead to more severe sanctions;

- reduction in the number of tendering opportunities that are given eg by excluding the non- complying party from tendering for Government work above a certain value;

- preclusion from tendering for any Government work for a specified period; and/or

- publication of details of the breach and the identification of the party committing the breach

- referral of the breach to the appropriate industry association for action consistent with industry codes of practice

. Full use is to be made of existing remedies and sanctions under existing legislation particularly under federal and state industrial relations laws

. Each jurisdiction will be expected to ensure that there are avenues for appeal and review where a sanction has been or is to be imposed - appropriate administrative or commercial law mechanisms should be available

. The National Code and or State codes should be established as a condition of the tendering process

. Jurisdictions will establish or provide effective coordinating mechanisms to ensure that the code is applied effectively in all agencies

. Breaches of the Code in one jurisdiction will be regarded as a relevant factor by other jurisdictions when considering the suitability of parties for government projects

. Construction Ministers will determine an appropriate role for The Australian Procurement and Construction Council (APCC) in monitoring the effectiveness of the

construction elements of the national code.

. Labour Ministers will monitor the effectiveness of the industrial relations and occupational health and safety elements of the Code as a standing agenda item on the

Labour Ministers' Council meeting.

Agreed by all Governments