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Consider commercial

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Have you always carried out residential building work? Coronavirus may beg the question of what else is out there to keep your business in business until we come through the pandemic.

Melissa Adler

Executive Director - Industrial Relations and Legal Services
While the residential building industry has continued to operate during these difficult times, we all know that the impact of this pandemic is far reaching. Potential customers are cautious, worried about their job security, and how and when restrictions will ease, so they are not committing to building projects in the same numbers. Compliance with COVID-19 health and hygiene requirements may have slowed down work onsite as well, meaning your business may be looking for ways to stay afloat and plug the gap that has been created. 

One way to do this might be by taking on some commercial building work. However, there are some differences between commercial and residential building work to be mindful of. 

One significant difference is that the construction requirements for commercial buildings are treated differently by the National Construction Code (NCC), particularly in respect to fire safety and disability access requirements. These aspects influence the design and the types of products that can be used for commercial buildings. 

Also different, except in Victoria, is that those who can carry out commercial building work is largely unregulated. This means that, unlike residential building work, there are no minimum legislated compliance requirements.

In Victoria, to carry out commercial building work you are required to be registered as a commercial builder. There are a range of registrations, the most expansive of which is becoming registered as Commercial Builder (Unlimited). Under this type of regulation you can carry out commercial building work of any height and floor size.

While contractual requirements to carry out commercial building work are also largely unregulated, having a contract in place remains important. HIA recently published a Small Works Commercial Contract that is available for members to purchase. The contract is designed for commercial work with a value of up to $50,000, is drafted in plain language and appropriately balances the rights and obligations of both parties.

Beyond the who, what and how, there is a range of other factors to be mindful of when considering carrying out commercial building work.

HIA’s new small works commercial contract is designed for commercial work with a value of up to $50,000

Employment law matters more on commercial sites 

When carrying out residential building work the issues associated with industrial relations, for example, employment obligations or engaging with the unions, may never have crossed your mind. However, moving to working on commercial sites could shed a different light on these issues. 

The construction unions, particularly the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU), are known to be very active on commercial construction sites, and they may seek to enter the site and talk to your workers. 

Under the Fair Work Act 2009 unions have the right to enter workplaces in certain circumstances. However, to exercise these rights, there are various rules and requirements. 

A union official who has a valid right of entry permit and on providing at least 24 hours’ notice may enter your workplace when: 

  • there is a suspected breach of the law that relates to or affects at least one member of the union; 
  • the union is entitled to represent the industrial interests of that member; and 
  • that member performs work on the premises.  

You may request to see a copy of the entry permit. 
While on the site to investigate suspected breaches, a permit holder can: 

  • inspect work, processes or objects; and
  • interview those who have agreed to be interviewed, whose industrial interests the permit holder’s organisation is entitled to represent. 

Unions may also enter a workplace to have discussions with employees regardless of whether there is a union member at the workplace. Discussions may only occur during non-working hours such as meal times and other breaks. You and a permit holder must agree on the location for these discussions. Where an agreement cannot be reached, the permit holder can carry out these discussions in a lunchroom or another area where breaks are ordinarily taken. 

Enterprise agreements 

Some commercial building companies enter into enterprise agreements (EA) with their employees and their employees’ representatives i.e. the relevant union. An EA is a legally binding agreement between an employer and their employees setting out the pay and working conditions of those people covered by it. 

In some cases you may be asked to agree to the EA when working on the particular site. This would mean that if you have employees their employment conditions must comply with the EA. If presented with an EA you should carefully consider its terms and conditions before agreeing to operate in accordance with it. 

Make sure you consult the code 

The NCC divides buildings into ‘classes’ which generally reflect their different occupancy and risk profile. The design and construction requirements for commercial buildings are set out in NCC 2019 Volume One and covers Class 2-9 buildings, which include multi-residential buildings, public buildings, shops, cafes and restaurants, offices and institutional buildings, such as hospitals and aged care facilities. 
The requirements for commercial buildings are significantly different to those for houses, with two of the biggest differences relating to fire safety requirements and access requirements for someone with a disability. 
With regards to fire safety, this includes requirements for compartmentation within buildings and separation requirements between buildings, width of paths of egress and travel distances. It also includes both active (sprinklers, smoke detection and suppression) and passive fire safety systems, such as for non-combustibility and FRL’s for external walls, as well fire hazard property requirements for internal linings. 
These all have a significant bearing on the building design and the allowable materials that can be used. 
The other major difference for commercial buildings in comparison to residential buildings is for providing access for people with a disability. Generally, for most commercial buildings the NCC requires that access be provided to all areas of the building used by its occupants, including for access to, and within, the building as well as its facilities. 
Therefore, if working on commercial buildings it is imperative to ensure you have a good understanding of these requirements, and not just assume the same requirements apply as they do for residential buildings. 
To access HIA’s Small Works Commercial Contract, go to www.hia.com.au/contracts