Express Law No. 311

12 December 2022

Repeal of the Building Code 2016

As part of the industrial relations reforms under the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022, the Code for the Tendering and Performance of Building Work 2016 has been repealed.

On 6 December 2022, the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (the SJBP Act) was given the Royal Assent. Following a staggered commencement set out at section 2, the Act will effect numerous changes to the laws governing industrial relations in Australia.

The broader industrial relations amendments are beyond the scope of this Express Law, but one noteworthy change for non-corporate Commonwealth entities involved in the tendering and procurement of building work (Funding Entities) is the repeal of Chapter 3 of the Building and Construction Industry (Improving Productivity) Act 2016 (the BCIIP Act). The repeal of this chapter of the BCIIP Act (which took effect on 7 December 2022) also repeals the Code for the Tendering and Performance of Building Work 2016 (the Building Code 2016) in its entirety.

Other related changes to be effected by the SJBP Act include the abolition of the Australian Building and Construction Commission, the renaming of the BCIIP Act as the Federal Safety Commissioner Act 2022, and the repeal of the Building Code 2013 (all of which will take effect on 6 February 2023, or an earlier date set by proclamation).

Consequences of repealing the Building Code 2016

As discussed in more detail in our Express Law No. 308, the requirements in the Building Code 2016 had already been substantially reduced following the Code for the Tendering and Performance of Building Work Amendment Instrument 2022 (the Amending Instrument).

Nonetheless, certain requirements upon Funding Entities remained even after the Amending Instrument, including requirements relating to the information to be provided by preferred tenderers, compliance with Australian Standards, and the ineligibility of Excluded Entities (as those terms were defined in the Building Code 2016). These requirements no longer apply.

Next steps for Funding Entities

Due to the extent of the changes brought about by the SJBP Act, existing template clauses (including the previous ABCC model clauses) will no longer be appropriate for new approach to market documentation or contracts. Clauses should be amended to reflect the changes effected by the SJBP Act. AGS can assist with this process, and in most cases it will be appropriate to remove all Building Code 2016 clauses from approach to market documentation and draft contracts. Funding Entities may also need to amend existing tender or contract documentation to address the repeal of the Building Code 2016, and we have set out some general guidance on this below:

Project status

Recommended approach

Procurement not yet issued to the market

For new procurements, the Building Code 2016 will no longer apply. Procurement documentation should be amended prior to release to the market to remove the Building Code 2016 requirements.

Procurement currently issued to the market (before closing time)

Funding Entities may need to issue clarification addenda to address the repeal of the Building Code 2016. In particular, Funding Entities should take steps to remove any mandatory response requirements relating to the Building Code 2016. It is possible that some respondents will omit Building Code 2016 responses in the knowledge that the Building Code 2016 has been repealed and (unless addenda have been issued to remove these as mandatory requirements) these responses may need to be excluded from evaluation.

Responses being evaluated (after closing time, but before a successful respondent is appointed)

Funding Entities should consider whether an addendum is required, depending on the stage of the procurement. Where a preferred respondent has been appointed, changes may only be required to contract documentation to remove the Building Code 2016 requirements prior to execution. For procurements earlier in the evaluation process, an addendum may be appropriate to clarify how Funding Entities will address Building Code 2016 compliance for the purpose of evaluation.

Procurement complete (contract signed)

Funding Entities should consider whether a contract variation is appropriate to clarify the removal of the Building Code 2016 obligations. Where existing clauses simply require compliance with the Building Code 2016, and interpretation clauses apply the Building Code 2016 as amended or repealed from time to time, amendment may not be necessary. If, however, contracts expressly require compliance with aspects of the repealed Building Code 2016, amendment may be appropriate to minimise the burden on contractors (and to align contracts with current legislative requirements).

Finally, Funding Entities should note the following:

  1. Entities should seek advice before enforcing any contract clauses which reflect provisions of the Building Code 2016.
  2. Chapter 4 of the BCIIP Act (The Federal Safety Commissioner) and the Building and Construction Industry (Improving Productivity) (Accreditation Scheme) Rules 2019 remain in force and are not impacted by the SJBP Act. Funding Entities should continue to apply the WHS Accreditation Scheme requirements of the BCIIP Act and the Accreditation Scheme Rules where appropriate.

Further information

Further information on the changes effected by the SJBP Act can be obtained from the Department of Employment and Workplace Relations. AGS can also provide specific advice on the repeal of the Building Code 2016 and Chapter 3 of the BCIIP Act, including by tailoring documentation to address or remove the requirements of the repealed Building Code 2016.

Contacts

CBR
PTH
Dixon, Mieke

Senior Lawyer and Team Leader Commercial Perth/Darwin

ADL