Greenfields agreement proposal deserves continued support of both major parties

“The Australian Industry Group welcomes today’s announcement by the Prime Minister that, if re-elected, a Coalition Government would allow longer term greenfields agreements for major projects. The ALP expressed support for a similar proposal ahead of the last Federal election, and the proposal deserves the continued support of both major parties,” Innes Willox, Chief Executive of the national employer association Ai Group said today.

“It makes no sense for a greenfields agreement entered into for a major project to expire at a critical stage during the construction of the project. This creates the risk of industrial action and associated project delays. Project delays can have a negative impact on safety and quality due to the accelerated catch-up programs that are often implemented to avoid the liquidated damages that are payable by construction contractors if a project is not completed on time.

“The proposal will be good for investment and good for jobs, particularly in the construction and mining industries. The proposal has the strong support of employers throughout all tiers of the construction and mining supply chains.

“Today the Prime Minister announced some new safeguards that are more stringent than those that were included in the greenfields agreement provisions in the Government’s former IR Omnibus Bill:

  • The provisions would only apply to greenfields agreements for major projects with a value of at least $500 million;
  • A maximum six year term;
  • A requirement that the greenfields agreement included annual wage increases at least equivalent to those awarded by the Fair Work Commission in the Annual Wage Review.

“The existing illogical and unnecessary restrictions on the nominal term of greenfields agreements for major projects are a barrier to investment, jobs and the recovery from the pandemic”, said Mr Willox.

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