Want to win Commonwealth work? You need a workplace relations management plan

Builders may not know it, but submitting tenders for federally-funded work recently got harder.

Under the new federal procurement code, the Code for Tendering and Performance of Building Work 2016 (Building Code 2016) (which has been in place since 2 December 2016) builders tendering for projects receiving $5 million or more of Federal Government funding must now, in most circumstances, include detailed workplace relations policies with their tenders, known as ‘Workplace Relations Management Plans’ (WRMPs). For principal contractors scrambling to get a tender over the line, it can often come as a surprise to learn that they can not be awarded a job until their WRMP has been approved by the Australian Building and Construction Commission (ABCC) which can often be a protracted process, if their WRMPs aren’t up to scratch.

To alleviate some of the stress associated with submitting a tender, Meyer Vandenberg has a developed a template WRMP. We have successfully achieved ABCC approval of a number of WRMPs based on this template.

What do WRMPs cover?

WRMPs set out how builders will comply with the Building Code 2016 on a particular construction project. The focus of WRMPs is detailing how the builder will deliver the project on time and on budget, through effective workplace relations and subcontractor management. However, WRMPs are complex and detailed documents which require builders to address disparate matters such as promotion of freedom of association, drug and alcohol testing and compliance with security of payment laws (reflecting the various policy aims of the ABCC). They also require principal contractors to explain how they will respond to any industrial disruption on a project, including legal strategies to mitigate any delays.

How are they approved?

When a principal contractor submits a tender for federally-funded work to a government agency or department, they will ask for a project-specific WRMP, which will then be forwarded to the ABCC for assessment.

Principal contractors cannot be awarded a tender unless their WRMP has been approved by the ABCC. That process often requires multiple revisions before approval is granted, which can lead to principal contractors missing out on a job while their WRMP remains in review.

Because WRMPs are legally binding (a breach of a WRMP is the same as a breach of the Building Code 2016) it is also important that builders do not become party to a hastily prepared WRMP, which may be impossible in practice to comply with. The ABCC is undertaking site audits of compliance with WRMPs, so it is important that WRMPs can be understood and implemented by employees and subcontractors.

What should you do?

It is essential that builders draft the non-project specific parts of their WRMPs in advance, to avoid missing out on federal work. Builders who leave this to the last minute find that they either:

  • lose tenders because of a slow WRMP approval process due to multiple revisions required by the ABCC, or alternatively
  • risk taking a ‘kitchen sink’ approach to drafting the WRMP, and in doing so commit to promises that cannot be complied with or are not properly incorporated into their own business systems.

The ABCC has published a model WRMP, which details the matters which builders must address, but does not provide any guidance on the particular policies that builders should adopt.

The Meyer Vandenberg WRMP pre-populates much of the required policies and processes, and will therefore reduce the amount of time you need to spend filling in your own project-specific WRMP, and is designed to minimise builders’ obligations whilst still complying with the Building Code 2016. It can be easily adapted for particular projects and particular builders’ systems.

Please call a member of Meyer Vandenberg’s Employment, Workplace Relations and Safety team to get tender-ready.

William Ward | Special Counsel
(02) 6279 4444

John Nikolic — Senior Associate
(02) 6279 4317