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Lend Lease v Baillieu

Australia’s Lend Lease faces being banned from billions of dollars of Victorian government work after signing a sweetheart deal with a powerful construction union according to the Sydney Morning Herald. Source: Sydney Morning Herald, The Age

Lend Lease’s four-year workplace agreement with the Construction, Forestry, Mining and Energy Union has been described as being in blatant defiance of the Baillieu government crackdown on union-friendly deals in the building industry.

The Baillieu government has said it will ban builders from bidding for government-funded work if they sign deals with unions that do not comply with its new code.

The new rules, which took effect from July, apply to deals signed in the private and public sectors, although a leading academic says they may fall foul of the Fair Work Act.

Senior industry sources and a written analysis obtained by The Age said the Lend Lease deal includes at least half a dozen key clauses that are in clear breach of the code.

The code, based on Howard government provisions, aims to stop workplace deals that promote unionism or place restrictions on the use of external labour.

Premier Ted Baillieu has been critical of Victoria’s aggressive building unions, in particular during the recent blockade at a Grocon site in the CBD. He has blamed them for driving up the cost of big projects such as at the Wonthaggi desalination plant.

The Lend Lease deal is the first real test of the new regime, which unions have attacked as ”anti-worker” and union bashing. The deal includes numerous restrictions on the use of labour that are meant to be forbidden.

They include dictating the minimum rates of pay employees of subcontractors receive and also by requiring that the use of labour hire and contractors be ”not in any way be designed to undermine the job security” of Lend Lease staff.

The deal gives greater access for union officials to building sites than is allowed under the Baillieu code while unions also have to be consulted about labour hire providers, which is also forbidden.

CFMEU national construction secretary Dave Noonan, who helped negotiate the deal, said the union was not worried about falling foul of the state government.

If Lend Lease is sanctioned, it could be stopped from bidding on freeways, buildings and other publicly funded projects.

Companies owned by Lend Lease, such as builders Abigroup and Baulderstone, can also be banned under the tough rules.
If Lend Lease and its subsidiaries were banned it could have major implications for the cost of building big projects. University of Adelaide law expert Andrew Stewart said the Baillieu government rules could be vulnerable to challenge under the Fair Work Act for breaching workplace rights.