Building Equality Policy: What you need to know

Following an announcement in early December 2021, the new Building Equality Policy has been published. Its aim is to improve representation of women in the construction industry. The policy sets minimum targets for hours worked in trade, non-trade and management roles.

The policy adds to the range of state wide procurement requirements (including Local Jobs First) which apply to medium and large scale state procurements. Departments, purchasers and advisors all need to be aware of these policies and their requirements.

When does the policy apply?

This policy applies to all public bodies or departments under s 3 of the Financial Management Act 1994.

The policy applies to all publicly funded construction projects valued at $20 million or more (allocated over the life of the project, and not the value of individual contracts, excluding GST), where the construction procurement activities commenced from 1 January 2022.

What are the policy's key targets?

Under the gender equality targets of the policy, women must perform:

• at least 3 percent of the contract works’ total estimated labour hours for each trade position
• at least 7 percent of the contract works’ total estimated labour hours for each non-trade Construction Award covered labour position
• at least 35 percent of the contract works’ total estimated labour hours for each management/supervisory and specialist labour position.

Additionally, suppliers are expected to engage registered female apprentices or trainees to perform building and construction work for at least 4 percent of the contract works’ total estimated labour hours for apprentices and trainees.

Suppliers are further encouraged to set targets in excess of these requirements.

How will the policy be implemented?

The policy will be implemented through the Social Procurement Framework (SPF), with the policy's requirements being incorporated into SPF buyer guidance, model clauses/templates and invitations to supply.

There will be a transitional compliance period between 2022-2023, aiming to improve the supply of female construction workers and develop more inclusive workplace cultures. However, after 1 January 2024, contracts will need to include penalty provisions for any supplier non-compliance with the policy.

What do suppliers need to do?

When submitting an expression of interest or tender for government funded construction work, suppliers must provide both a project-specific and organisation-wide gender quality action plan (GEAP), similar to the existing requirements under the Gender Equality Act 2020.

Suppliers must also undertake a project specific and organisation-wide gender audit, which assesses the particular issues contributing to gender inequality in the workplace and the sector. The GEAP should include these findings, as well as the strategies and measures being implemented by the supplier to improve gender equality.

What do I need to do now?

Public entities should start thinking about how they can address gender inequality in the construction sector, and how they can assist in the transitional period so that proper mechanisms are in place by 1 January 2024. Entities can do this by:

• emphasising the importance they place on gender equality in construction throughout the procurement process, and engaging in discussions with prospective suppliers about how they intend to meet the policy targets
• considering which initiatives they can start implementing to ensure their organisation will be meeting the policy's requirements by 1 January 2024
• considering incorporating the policy's requirements (such as having suppliers provide GEAP or meet female employment targets) within their contracts as early as possible.

Shortly, the SPF will be updated to incorporate this new policy, including in the buyer guidance and model clauses. The Building Industry Consultative Council will also be hosting consultative forums which will provide further guidance to government on the development of procurement-related templates and guidelines.

Contact our team

If you would like more information on how your entity should respond, please contact us.

Sophie Lefebvre, Principal Solicitor
Phone: 0409 013 559
Email: sophie.lefebvre@vgso.vic.gov.au

Publication written by Sophie Lefebvre, Principal Solicitor, and Alexandra Lioudvigova, Law Graduate.