Australia: Victorian Fair Jobs Code: New rules for businesses tendering for Victorian Government contracts

What is the Code?

The Victorian Fair Jobs Code is being introduced by the Victorian Government to ensure that suppliers tendering for Victorian Government procurement contracts and businesses applying for significant business expansion grants are treating their workers “fairly” and are abiding by industrial laws and relevant health & safety regulations.

Under the Code, suppliers and grant applicants will have to attain a Pre-Assessment Certificate and in certain circumstances, submit a “Fair Jobs Code Plan”.

Who will it apply to?

The Code will cover Victorian Government agencies, suppliers and grant applicants applying for grants or contracts above the amounts below:

• Any supplier applying for a contract with a value of $3 million or more; and
• Any grant applicant applying for a Business Expansion Grant worth $500,000 or more.
• Where the tender is for $20 million or more, subcontractors performing work on the project worth $10 million or more must also have a valid Pre-Assessment Certificate.

^{*Amounts excluding GST.}

When will the Code take effect?

Applications for Pre-Assessment have been open since 10 August 2022.

From 1 December 2022 all Victorian Government agencies must apply the Code to all tender processes released to the market after this date.

The Code will not apply retrospectively to tenders already awarded or released to the market.

How will the Code operate?

Suppliers and grant applicants who meet the threshold values will be required to hold a Pre-Assessment Certificate in order to tender for projects or apply for significant grants.

The certificates are valid for a period of two years and must be renewed by the supplier or grant applicant.

Applicants for a certificate can apply online. There is no charge for applying for a certificate.

The Code will be administered by the “Fair Jobs Code Unit”, an administrative group with the Victorian Department of Jobs, Precincts and Regions.

What information must be supplied?

Applicants for a Pre-Assessment certificate must supply the following information:

• General information about the applying entity including ABN number, corporate structure, company or incorporation extracts etc.
• Employment related compliance breaches that have occurred in the last three years. This can include Enforceable Undertakings against the applicant or an adverse court or tribunal funding.
• Evidence of corrective action against a compliance breach. This can include policies or procedures, or compensation paid to employees.

Criteria for assessment

The information supplied by applicants will be assessed across the following five standards:

1. Compliance with all applicable employment, industrial relations and workplace health and safety obligations. This includes key workplaces laws such as the Fair Work Act and the Victorian Occupational Health and Safety Act.
2. Promoting secure employment and job security.
3. Fostering cooperative and constructive relationships between employers, employees and their representatives.
4. Fostering workplace equity and diversity.
5. Promoting supply chain compliance.

^{*Threshold contracts worth $3 million or more but less than $20 million will only be assessed against Standard 1.}

In considering an application against the standards above, the FJC Unit will consider the seriousness of conduct, whether the conduct was isolated or systematic, whether the incidents were disclosed during the application process and what steps, policies, models or compliance measures have been implemented since any potential breaches.

Fair Jobs Plan

Tenderers for contracts worth $20 million or more and applicants for significant business grants must also submit a Fair Jobs Plan to the Victorian Government Agency with their tender.

The plan must be submitted on the prescribed FJC Plan Template and must contain:

• Policies for complying with applicable workplace laws, including the Fair Work Act.
• Policies for supporting Standards 1 to 5 of the Code.
• Information about how employees are engaged during the tender including the number of people employed on the project, the estimated length of their engagement, the rationale for the different types of employment to be used (casual, full-time, fixed etc).

Key takes for business

Businesses that regularly tender for Victorian Government contracts worth $3 million or more must familiarise themselves with the operation of the Code.

This includes implementing internal processes to ensure that Pre-Assessment Certificates are kept valid and renewed as required.

The change will place a greater need on business to ensure accurate information and record keeping relating to employment practices and any potential breaches of industrial or health & safety laws.

Businesses should be aware that the Code contains a requirement for ongoing disclosure and certificate holders must notify the Victorian Government Agency of any adverse ruling or enforceable undertaking against them.

The Code also requires certificate holders to notify the relevant Victorian Government Agency within 10 days if their Pre-Assessment Certificate expires or is revoked.

Herbert Smith Freehills is able to assist clients to comply with the Fair Jobs Code and any regulatory changes resulting from updates to industrial or work health and safety legislation or regulations.

This article was prepared by Nicholas Ogilvie, Partner and Nicholas Lamanna (Solicitor).