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New building industry code controversial

With its social policy all but in place, the Labor Government’s focus in its second year appears firmly set on industrial relations.

The Labor Government’s Industrial Relations Reform Bill 2002 is just the first in a wave of new legislation the business community will have to contend with over the next year, with the construction industry set to receive the most attention from unions and the Government.

This week, Consumer and Employment Protection Minister John Kobelke unveiled a building industry code that he said would lead to higher safety standards, greater productivity and would promote a culture of best practice.

Mr Kobelke said the code received wide-ranging industry support following a review by Parliamentary Secretary Norm Marlborough, together with industry and union representatives.

The new code embodies the establishment of an industry body, the Code Monitoring Committee, that will act as a contact point for alleged breaches of the code. The code also establishes a set of implementation guidelines for the Government to comply with best practice on tendering and contract administration of building and construction work.

Next week, the Government will also move on with recommendations made in a report from the Security of Payments Taskforce that was formed by the former Liberal government and is now headed by Labor parliamentary member John Hyde.

Public comments are due in by February 7, but industry is already cautious of the new payment protection measures that the legislation would bring.

The contained draft legislation within the report hopes to tackle the security of payment within the construction and building industry by facilitating timely payments between parties and provide for rapid resolution of payments disputes.

The draft legislation intends that everyone in the construction chain should be paid within 28 days, while paid-when-paid clauses would become illegal.

But perhaps the most controversial aspect of industrial changes still to see the light of day will be the unfair contracts or contract determination legislation that Mr Kobelke signalled last year would be a feature of his industrial relations agenda. The laws, already introduced in Queensland and New South Wales, brings the dealings between contractors and their principals into the industrial relations system.

If the legislation takes the same form of that introduced in Queensland, the changes will allow for rates to be set for groups of contractors if their remuneration is considered too low, effectively putting contractors under an award system.

Some Perth lawyers expressed concern to Business News that the legislation would also further increase the power of the WA Industrial Relations Commission by giving it the power to override contracts agreed to by both parties if it is deemed unfair.

Master Builders’ Association WA director Michael McLean, who last week was scathing over the draft Industrial Relations Reform Bill (which the public has until February 1 to comment on), is equally concerned about bringing contractors within the industrial relations system.

“The implications for the building industry would be diabolical. The independence of contractors is paramount and is something that the MBA has a very strong view of,” Mr McLean said.

Chamber of Commerce and Industry of WA employee relations director Bruce Williams said such a move would indicate the Government was playing into the hands of the unions.

“What has been clear for many years is that unions have been unhappy with contract labour,” Mr Williams said.

But while taking a firm ground on the new Industrial Relations Bill and any thought of introducing contract determination legislation, the MBA has softened its view on both the report of the Securities of Payments Taskforce and the new code.

MBA contract manager Charles Anderson said while he was concerned with the aspect of the taskforce legislation which allowed for rapid adjudication, the MBA was learning to accept the Labor Government’s agenda.

“We don’t believe there has been a need for this kind of legislation. That was our original position, but we have now moved on and we are dealing with legislation that the Government seems destined to push through,” Mr Anderson said.

A spokesman for Mr Kobelke said the legislation was being put on hold until its other industrial relations reforms were put in place.

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