Major builders risk losing millions of dollars of government work after the Construction Forestry Mining Energy Union decided to refuse to renegotiate workplace deals that don’t comply with the federal government’s building code.
The high-stakes move sets the construction union on a collision course with the Turnbull government and reinstated building regulator the Australian Building and Construction Commission.
The building code, attached to the ABCC bill which passed over union objections in November, bans companies from government work if their industrial agreements breach highly prescriptive rules about their content.
Last week the CFMEU’s construction division said it would reject the code as an attack on workers’ rights and vowed to resist it “by all means available”.
“The code discriminates against workers and promotes job insecurity, poor safety and the exploitation of temporary visa workers,” it said.
Companies have until September to negotiate code-compliant agreements, after senator Derryn Hinch agreed to trim the phase-in period to nine months.
But the CFMEU construction national secretary, Dave Noonan, told Guardian Australia the binding resolution meant the union would not accept demands by employers to cut conditions that put agreements in violation of the code.
“Where there is an agreement in place, and many of those have only just been concluded, it’s quite lawful.
“Employers are saying we need to pull those apart, and we’re saying we don’t accept that, we’re not going to give those conditions away and give you a code-compliant agreement just because you ask.”
The union objects to the code and ABCC guidance ban clauses that:
- give Australian residents and citizens preference over workers on temporary work visas in employment and retrenchment
- limit casualisation or place restrictions on replacement of permanent employees with labour hire workers
- set minimum ratios for apprentices
- ban an “all-up rate of pay”, which the union believes is an attack on overtime penalty rates because employers can pay a total rate of pay that discharges the obligation to pay penalties.
Noonan agreed that the union’s decision could have a wide impact on which builders can negotiate for government work.
He noted that builders in Victoria and Queensland had a new generation of agreements in place with up to three years still left to run, and any company with a non-compliant agreement anywhere in the country would not be eligible for government work.
Asked about widespread consequences of the decision, Noonan replied: “That’s a matter for the government – we’re not the ones who have made the call to ban anyone from government work.”
“Are they proposing to ban companies because they don’t like the contents of their industrial agreements? Do they have to casualise their workforces?
“These are important protections. Let’s see the colour of the [government’s] money – we’re not bluffing either.”
Noonan said it was the government’s “highly ideological” approach to industrial relations and not the unions decision that was the cause of a looming “disaster” of major builders being refused work.
The Master Builders Australia chief executive, Denita Wawn, suggested the CFMEU’s threat was a “stunt” but added it was “consistent with their antics of long-standing”.
“[The union’s decision is] totally unhelpful and un-useful for builders trying to do their job. It will hold up infrastructure ... and the union is holding the country to ransom.”
Wawn suggested that builders could be forced to seek non-union agreements or pursue good-faith bargaining cases to force the union to renegotiate agreements.
The employment minister, Michaelia Cash, said the code was “the law of the land, as passed by parliament”.
“The CFMEU’s refusal to respect and adhere to the law is disappointing but unsurprising,” she said, despite the fact that it is not unlawful to refuse to comply with the code.
Cash did not respond to questions about whether the government has done modelling on the impact of increased costs on government projects if fewer builders are able to tender for work.
