Last week the Victorian Government released its Fair Jobs Code which sets out the requirements that Suppliers of goods, services or works must meet to be engaged by the Victorian Government.
The Victorian Code is important for a number of reasons, not the least being that the current Federal government has committed to introducing what it calls a Secure Australian Jobs Code for those seeking federal government contracts this Victorian Code could be a template for what the Federal Code may contain.
The Victorian Fair Jobs Code also has an eerie similarity to the recently gutted ABCC Building Code, except that it is focussed on different objectives. The Fair Jobs Code is also similar in theme to the ACT Secure Local Jobs Code which commenced earlier this year.
In the broad, what does the Fair Pay Code require?
A Supplier wanting a contract with a Victorian Government Agency must hold a “Pre-Assessment Certificate” for contracts with a value of $3 million or more (threshold procurement contracts) and contracts with a value of $20 million or more (high value procurement contracts). The certificate is valid for a two year period from the date of issue, unless it is revoked.
For high value procurement contracts, a Supplier must also submit a Fair Jobs Code Plan as part of the procurement process.
There is a Fair Jobs Code unit (FJC Unit) that is tasked with determining whether to issue Pre-Assessment Certificates. It also assists Victorian Government Agencies with the assessment of Fair Jobs Code plans.
It maintains a Register of those Suppliers who have Pre-Assessment certificates (which will be public) and a Register of those who don’t, or who have had their certificates revoked. That is a private register – a black list.
The FJC Unit will also undertake audits and reviews (which will be a condition of Suppliers wishing to obtain a relevant Victorian Government Contract), and deal with complaints made about Suppliers.
What timeframe is involved?
From 10 August 2022: Guidelines, templates and supporting information have been released, and applications have now opened for Pre-Assessment Certificates.
From 1 December 2022: All Victorian Government agencies must apply the Code to all tender processes (and subsequent procurement contracts) and grant applications (and subsequent grants) released to the market or to the public on or after this date.
For Standing Offer Arrangements (including State Purchase Contracts and Sole Entity Purchase Contracts) the Code will apply from the date that the Standing Offer Arrangement commences or is updated or reissued to refer to the Code following implementation.
As this Code is operative already, Suppliers must apply to get Pre-Assessment Certificates between now and 1 December 2022.
Pre-Assessment Certificate – the criteria and other things
In conducting an assessment the FJC Unit will take into account the following:
- the underlying seriousness of the conduct reflected in any adverse ruling or enforceable undertaking concerning the Supplier or business, including whether, in the past three years, it has:
- committed an offence against the law of the State or another jurisdiction; or
- engaged in conduct that took advantage of, treated unfairly or otherwise harmed its workers;
- whether any conduct reflected in an adverse ruling or an enforceable undertaking was isolated or systemic;
- whether the Supplier or business disclosed any adverse rulings or enforceable undertakings to the FJC Unit and/or a Victorian Government agency during the application process or term of a threshold or high-value procurement contract or significant business expansion grant;
- whether the Supplier or business has taken steps to rectify any conduct reflected in any adverse rulings or enforceable undertakings;
- whether the Supplier or business has taken steps to ensure that the conduct does not reoccur, including changing systems, staff training, business models or compliance efforts;
- any information provided to the FJC Unit by:
- the Supplier or business;
- victims or persons directly affected by the conduct;
- regulators involved in investigating or taking action in relation to any adverse ruling or enforceable undertaking; or
- Victorian Government agencies that have engaged with the Supplier or business.
There will be a Pre-Assessment Certificate Application Form (not currently available) which must be used.
The FJC Unit will seek to advise the outcome of an assessment application within 30 business days of receiving the application.
A summary of the information that may be required is as follows:
- details of governance arrangements
- compliance history and corrective actions taken
Moreover a Supplier has to agree to:
- the FJC Unit making inquiries to access and verify information provided;
- notifying the FJC Unit of any adverse ruling or enforceable undertaking within 10 business days of the ruling or undertaking being made;
- participate in audit and/or review processes,
and for high value procurement contracts a Supplier has to submit a FJC Plan and provide regular reports about code implementation, and respond to reasonable requests for information.
Review process for decisions to refuse or revoke a Pre-Assessment Certificate
A Supplier can request a review of a decision to refuse or revoke a Pre-Assessment Certificate which will be dealt with internally within the Department of Jobs, Precincts and Regions.
A decision is also likely susceptible to judicial review in the Supreme Court.
The FJC Plan
The FJC Plan will require Suppliers to provide information in relation to compliance with Standards 1 to 5 of the Code including:
- policies and procedures in place to ensure compliance with applicable laws (for example, the Fair Work Act 2009 (Cth) and occupational health and safety laws);
- policies or procedures in place to support Standards 1 to 5 of the Code; and
- labour requirements of the high value procurement or significant business expansion grant, including:
- the number of people engaged and the estimated duration of the engagement and how these people will be sourced or engaged;
- strategies to give preference to ongoing forms of employment over casual, fixed term or labour hire arrangements; and
- the rationale for using casual, fixed-term and/or labour hire arrangements (if applicable).
Suppliers bidding for a high value contract have to submit an FJC Plan at the time of submitting a tender.
The Code Standards
Before setting out the Standards below, Suppliers seeking to enter a threshold procurement contract must comply with Standard 1 whilst Suppliers seeking to enter into a high value procurement contract have to comply with all the Standards.
The Standards are:
Standard 1: Comply with all applicable employment, industrial relations and workplace health and safety obligations
Suppliers and businesses must comply with all applicable employment, industrial relations and workplace health and safety laws, including:
- Fair Work Act 2009 (Cth);
- Occupational Health and Safety Act 2004 (Vic) (and, if relevant, the WHS laws in other States and Territories);
- Wage Theft Act 2020 (Vic) (and, if relevant, the Criminal Code and Other Legislation (Wage Theft) Amendment Act 2020 (Qld));
- Long Service Benefits Portability Act 2018 (Vic) (and, if relevant, similar legislation in other jurisdictions);
- Labour Hire Licencing Act 2018 (Vic) (and, if relevant, similar licensing legislation in Queensland, South Australia and the ACT); and
- any other laws specified in the Guidelines (eg, Superannuation Guarantee (Administration) Act 1992 (Cth), Workplace Injury Rehabilitation and Compensation Act 2013 (Vic) and the Child Employment Act 2003 (Vic)).
Standard 2: Promote secure employment and job security
Suppliers and businesses must:
- endeavour to engage workers directly and on a permanent basis wherever possible, and must only enter into arrangements for the provision of labour hire services with a provider who is licensed under the Labour Hire Licensing Act 2018 (Vic).
- comply with immigration and migration laws when employing workers who are not Australian citizens; and
- ensure employees’ terms and conditions of employment comply with legal obligations under Australian immigration and migration law and any conditions of the employee’s working visa.
- reflect secure employment arrangements in their organisational policies.
- have policies, procedures, plans and/or systems in place to ensure that they do not knowingly or recklessly misrepresent an employment relationship or a proposed employment arrangement as an independent contracting arrangement.
Standard 3: Foster cooperative and constructive relationships between employers, employees and their representatives
Suppliers and businesses must:
- allow employees to actively participate in and be represented by the industrial organisation or association of the employees’ choice, subject to applicable laws.
- strive to make reasonable allowances for employees and bargaining representatives to participate in enterprise agreement negotiations.
- have processes in place to consult with employees and employees’ representatives about major workplace changes that are likely to have a significant effect on the employees, subject to applicable laws.
- subject to applicable laws, have processes in place that allow all employees the opportunity to attend meetings with union, health and safety or employee representatives, and access to noticeboards, email or other communication facilities to facilitate communication between workers and/or employee representatives regarding work matters.
- recognise validly elected union workplace delegates or employee representatives and have processes in place that allow communication between employees and their representatives subject to requirements under applicable laws.
Standard 4: Foster workplace equity and diversity
Suppliers and businesses must:
- comply with anti-discrimination and equal opportunity laws, and
- demonstrate a commitment to equity and diversity in their organisational practices.
Standard 5: Promote supply chain compliance
Suppliers and businesses must take reasonable steps to ensure that direct subcontractors in relation to a high value procurement contract or significant business expansion grant, comply with all applicable employment, industrial relations and workplace health and safety obligations.
Suppliers engaged in relation to a high value procurement contract must only enter into a subcontracting arrangement with subcontractors that also have a Pre-Assessment Certificate, unless the value of the subcontract is less than $10 million (exclusive of GST).
Thoughts
Standards 2 and 3 signal a push to minimise “insecure” work arrangements and foster the involvement of unions in the business of a Supplier.
Standard 5 is a device intended to expand the application of the Code by requiring a Supplier to enter into a subcontractor arrangement only if the subcontractor has a Pre-Assessment Certificate (unless the value of the subcontract is less than $10 million – exclusive of GST).
Complaints about a Supplier
A Supplier holding a Pre-Assessment Certificate may be the subject of complaint to the FJC Unit.
The following persons (or their representatives) may make a complaint to the FJC Unit about a Supplier or business that holds a Pre-Assessment Certificate:
- a worker or former worker employed or engaged by the Supplier or business;
- a regulator or decision-maker who has made an adverse finding relating to the Supplier or business;
- a party to any dispute which resulted in an adverse finding relating to the Supplier or business; or
- a Victorian Government agency that has engaged with the Supplier or business in the past three years in relation to the supply of goods, services or construction works or the provision of grants.
The FJC Unit may use a complaint or information disclosed in or discovered as a result of a complaint in determining whether to grant, reassess or renew a Pre-Assessment Certificate to a Supplier.
In some circumstances the complaint may also be a protected disclosure under the Public Interest Disclosure Act 2012.
One could see how a complaints process could be weaponised against a Supplier if they were seen as not towing the “secure employment” line.
Other things and what does this all mean?
If the FJC Unit decides to revoke a Supplier’s Pre-Assessment certificate or a Supplier allows it to lapse, a Victorian Government Agency may sue for breach of contract given that having and maintaining a Pre-Assessment Certificate is a condition of contract.
The Code is not a legislative instrument. Accordingly if it is applied in a way that breaches, for example, the general protection provisions of the Fair Work Act 2009, the fact of there being a document called a Code, offers no protection. Contrast that with the ABCC’s Building Code, that was a legislative instrument, which provided protection.
The Code will create an industry for form filling given the type of information sought, how extensive it has to be, and the need to justify why, as a Supplier, you should be able to do work for the Victorian Government. What was highly process driven before, will be even more so now, with clear social engineering goals in mind.
And, when what is involved is being able to tender for a high value procurement contract of $20 million or more, the stakes involved in not getting a Pre-Assessment Certificate, or having it revoked may be such that there may be a lot of litigation in respect of outcome of those decisions.
As for the touted Federal Secure Jobs Code, the Victorian Fair Jobs Code may be a fair weather warning of what businesses will face later this year.