Urgent need to restore the rule of law to the building and construction industry

Media Release
  • Leader of the Government in the Senate
  • Minister for Employment
  • Minister Assisting the Prime Minister for the Public Service
  • Senator for Tasmania

Media reports about the spread of the culture of unlawfulness in the building and construction industry highlight the need for the Senate to pass legislation to re-establish the Australian Building and Construction Commission (ABCC), Minister for Employment Senator Eric Abetz said today.

“The deliberate abolition of the ABCC by the former Labor Government has, according to the FWBC, seen the disregard for the law that defined the industry in Victoria and Western Australia spread to South Australia, Queensland and New South Wales,” Senator Abetz said.

"The Royal Commission into Trade Union Governance and Corruption concluded in its interim report that there is a “culture of wilful defiance of the law which appears to lie at the core of the CFMEU.”

During the ACCC investigation of the CFMEU boycott against Boral, ACCC Chairman Sims was confronted by the culture of silence and fear of reprisal that is a feature of the building and construction industry.

Mr Sims said that “the ACCC has only been able to progress the investigation by compelling people to give evidence.” Without the ACCC’s compulsory powers, the serious wrongdoing alleged would not have been put before the Court.

“Compulsory powers are necessary to break this culture of silence and shine a light on the intimidation, thuggery and fear of reprisal that has darkened the industry,” Employment Minister Senator Eric Abetz said.

Other regulators, such as the ACCC, ASIC, APRA and even Medicare, have compulsory powers similar to those proposed for the ABCC. These powers are in no way novel or unusual.

When Labor abolished the ABCC to appease the CFMEU, it also slashed the maximum penalties for breaking the law by two-thirds. This only encouraged the CFMEU to continue its wilful defiance of the law. When the CFMEU was fined over $1 million by the Victorian Supreme Court from criminal contempt of court, the court remarked that:

“the imposition of a penalty for contempt of court should not be viewed as simply an anticipated cost of industrial action…few things could be more destructive to the authority of the Court and to the rule of law, than the idea that fines or similar punishment are akin to a tax that, once budgeted for, enabled the use of unlawful conduct to achieve industrial outcomes.”

Even when the maximum penalties were still at a meaningful level, the Federal Court said that the CFMEU had “a deplorable record of contraventions…” and “[t]he contraventions are significant. Substantial penalties for past misconduct have not served to prevent repetition.”

Senator Abetz said even Labor’s own inquiry into the ABCC’s powers in 2009 found that that it would have been irresponsible to remove them because of the extent of unlawfulness in the building and construction industry.

“There is an urgent need to re-establish an effective regulator to enforce appropriate laws and sufficient penalties to deter unlawful conduct, and stop the thuggery and lawlessness in the construction industry,” Senator Abetz said.

For more information

Media line: (02) 6240 8667, media@employment.gov.au