CHAPTER 1


CHAPTER 1

Introduction and Background

Reference

1.1        On 10 November 2011 the Senate referred the provisions of the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2011 (the bill) to the Senate Standing Legislation Committee on Education, Employment and Workplace Relations for inquiry and report by 29 February 2012.[1]

Conduct of inquiry

1.2        The committee advertised in The Australian on 23 November 2011, calling for submissions by 20 January 2011. Details of the inquiry were placed on the committee's website.

1.3        The committee also contacted a number of organisations inviting submissions to the inquiry. Submissions were received from 19 individuals and organisations, as listed in Appendix 1.

1.4        A public hearing was held in Melbourne on 3 February 2012. The witness list for the hearing is at Appendix 2.

Background

1.5        The bill represents the government's response to the report by the Hon Murray Wilcox QC, Transition to Fair Work Australia for the Building and Construction Industry (the Wilcox Report).[2] The Department of Education, Employment and Workplace Relations advises that the bill gives effect to the Forward with Fairness – Policy Implementation Plan policy commitments that the Government took to both the 2007 and 2010 elections.[3]

1.6        The committee is very familiar with the subject matter and key provisions of this bill. Nine years ago the government introduced the Building and Construction Industry Improvement Bill 2003. This bill lapsed in the Senate when Parliament was prorogued in 2004. Nevertheless, the committee produced a report in June 2004 covering the 2003 bill and related matters.[4] In 2005 the Building and Construction Industry Improvement Bill 2005 was introduced and passed, and is the current Building and Construction Industry Improvement Act 2005 (BCII Act). The committee inquired into the 2005 bill and tabled a report in May of that year. Senator Siewert introduced the Building and Construction Industry (Restoring Workplace Rights) Bill 2008. The committee inquired into and reported on this bill in November 2008.

1.7        On 17 June 2009 the government introduced the Building and Construction Industry Improvement Amendment (Transition to Fair Work) Bill 2009. The Senate referred the provisions of the bill to the committee. The bill lapsed when Parliament was prorogued on 19 July 2010. The committee inquired and presented a report in September 2009. The bill before the committee in this inquiry is almost identical to that considered by the committee in 2009.

1.8        The committee supports the findings of the committee majority report in 2004, the Opposition senator's report in 2005, the committee majority report in 2008 and the committee majority report in 2009. The committee refers readers unfamiliar with earlier inquiries to the detail of the committee's previous reports. [5]

Purpose of the bill

1.9        The bill seeks to create a new set of compliance arrangements for the building and construction industry.

1.10      The bill would abolish the Office of the Australian Building and Construction Commissioner and would create a new agency, the Office of the Fair Work Building Industry Inspectorate (the Building Inspectorate) to regulate the building and construction industry.

1.11      The Building Inspectorate would be headed by an independent Director appointed by the Minister. The Director would manage the operations of the Building Inspectorate and would not be subject to control by other statutory office holders. The bill would also create an Advisory Board comprised of industry stakeholders who would make (non binding) recommendations to the Director on the policies and priorities of the Building Inspectorate.

1.12      The bill would remove the existing building industry laws that provide higher penalties for building industry participants who breach of industrial law. The bill would also remove existing building industry-specific laws that provide broader circumstances under which industrial action attracts penalties. These measures would bring general compliance and penalties in the building and construction industry into line with those under the Fair Work Act 2009.

1.13      The bill would include capacity for the Director of the Building Inspectorate to obtain an examination notice authorising the use of powers to compulsorily obtain information (including through requiring a person to attend an examination and answer questions) or documents from a person whom the Director believes has information or documents relevant to an investigation.

1.14      The bill would introduce the following safeguards in relation to the use of the power to compulsorily obtain information or documents:

  • use of the powers would be dependent upon a presidential member of the Administrative Appeals Tribunal being satisfied a case had been made for their use and issuing an examination notice;
  • persons summonsed to interview could be represented by a lawyer of their choice and their right to refuse to disclose information on the grounds of legal professional privilege and public interest immunity would be recognised;
  • people summonsed for examination would be reimbursed for their reasonable expenses, including reasonable legal expenses;
  • all examinations would be videotaped and undertaken by the Director or an officer from the Senior Executive Service;
  • the Commonwealth Ombudsman would monitor and review all examinations and provide reports to the Parliament on the exercise of this power;
  • the powers would be subject to a three year sunset clause. The decision on whether the coercive powers are extended beyond three years would be made following a review of their use and ongoing need; and
  • the bill would create the office of the Independent Assessor – Special Building Industry Powers, who, on application from stakeholders, may make a determination that the examination notice powers will not apply to a particular project (where it is appropriate and not contrary to the public interest).

1.15      The bill would not affect the provisions that establish the Office of the Federal Safety Commissioner and its related Occupation Health and Safety Accreditation Scheme.

1.16      The differences between the current bill and the 2009 iteration are minor. The period of the sunset clause has been changed from five years to three years and a number of minor textual changes have been made that are consequential to recent amendments to the Acts Interpretation Act 1901.[6]

1.17      In Chapter 2 the committee considers the key issues that arose during the 2009 inquiry, and the committee majority's conclusions at that time. The committee will also examine the issues raised during this and the 2009 inquiry.

Acknowledgement

1.18      The committee thanks those organisations and individuals who contributed to this inquiry by preparing written submissions and giving evidence at the hearing.

Note on references

1.19      References in this report to the Hansard for the public hearings are to the proof Hansard. Please note that page numbers may vary between the proof and official transcripts.

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