Workplace Relations Legislation Amendment (Building Cooperative Workplaces No. 1) Bill 2026
Senator KOVACIC (New South Wales) (17:30): The coalition supports practical reforms that help the Fair Work Commission deal with its workload, but we do not support the enterprise bargaining procurement changes. The government should not be using sensible Fair Work Commission reforms as a cover for passing unrelated procurement changes—again, as is the hallmark of this government, another attempt under the cover of darkness.
This bill, the Workplace Relations Legislation Amendment (Building Cooperative Workplaces No. 1) Bill 2026, should be split so we can pass the Fair Work Commission reforms and separately scrutinise the procurement bargaining provisions. We call on the government to separate the bill into two, and we will support the Fair Work Commission changes alone. It is up to the government whether they choose to do that.
If the government does not agree to this, we will not support the bill unamended. Commonwealth procurement should be based on value for money, capability and compliance with the law, not whether a business has a preferred industrial instrument. We have seen what happens when procurement policy is used to advantage certain union-controlled arrangements.
We have seen that in Victoria with the Big Build; we have seen the devastating impacts of that. We have seen the loss of some $15 billion of taxpayer funds. We have seen bullying, intimidation and corrupt and criminal conduct.
It risks higher costs for taxpayers, reduced competition and a pay-to-play culture that entrenches corruption and shuts out lawful businesses. That is unacceptable. I note Senator Barbara Pocock's comments that a cooperative workplace is one where one side doesn't hold all the power, but currently we have a scenario where in many workplaces the CFMEU does hold all the power.
This bill risks embedding that even further. The procurement provisions risk pushing union-covered enterprise agreements through Commonwealth contracting and down supply chains. That is what will happen.
Senator Polley said that some of us on this side are obsessed with the CFMEU. Tell that to Victorians. Tell the Victorian taxpayers, who have funded the $15 billion worth of rorts, that raising that in this place is an obsession.
It's the calling out of a reality. We have seen those same practices, those unlawful practices, extend to Queensland and to my home state of New South Wales. That is entirely unacceptable.
Call it an obsession, but I will not stand by and allow my state of New South Wales to come to the same fate Victoria has with its Big Build and the entrenched illegal conduct of the CFMEU. This government knows exactly what it is doing, and it knows that it is wrong. When a government truly believes in reform, it stands up and argues for it.
It is transparent. It gives it its own bill. It sends it to a committee.
It calls witnesses. It publishes submissions and lets the country look at it in the light of day. That is how a confident and transparent government legislates.
That is what this government doesn't seem to want to do. It hides in the shadows. It won't provide documents transparently under OPDs.
It makes stakeholders sign NDAs. That is the hallmark of the Albanese Labor government. A fundamental change to the way the Commonwealth spends every public dollar, a change that rewrites the rules of procurement for every contract and every single grant has been buried inside an unrelated bill about Fair Work Commission resourcing.
Why? Why has this government buried it there? Because it didn't want anyone to see it.
It didn't want the scrutiny. And, so far, it is refusing to separate it out. Let's look at what that bundling together does.
It takes a set of sensible, supportable reforms to help the commission with its workload and its straps the procurement grab to them like a hostage. 'Here, take both. You must take them both.' Vote for the workers waiting on the commission and you must also vote for the union's tollbooth. That's not a legislative program; that's some kind of absurd trap.
Governments don't bury things that they are proud of. They bury things that they cannot defend. The secrecy here tells us everything.
The secrecy here is the confession from the Albanese Labor government. If this provision could survive honest scrutiny, they would have given it time. But they did not because they know that it cannot.
And let us be clear about what this government knows. It is not acting in ignorance. It has the Watson report into CFMEU corruption.
It knows about the agreements bought for cash. It knows about the labour hire deals sold for up to $1 million. It knows about the decent contractors driven out of business when the union refused them an agreement.
It knows about Women in Construction that has at the helm of it an individual that has assaulted women. It knows that too. It knows that the system was, in the words of the Watson report, 'thoroughly corrupted' with 'old-fashioned pay to play'.
Yet here we are. It knows all of it and, knowing all of it, it has written a bill that hands union agreements a privileged place in the spending of public money. Not a cooperative workplace, but in fact something where one side holds all the power.
This is a government doing its paymasters bidding under the cover of darkness because it does not have the courage to do it in the daylight. Currently, the Fair Work Act prohibits discrimination against an employer because of whether its employees are or are not covered by certain industrial instruments, including the National Employment Standards, workplace instruments or enterprise agreements.
This means no-one, including the Commonwealth, can prefer one company over another just because it has union affiliated enterprise agreements. This bill creates an exemption that would allow the Commonwealth to preference employers whose employees are covered by a union covered enterprise agreement. Put simply, this bill creates this exemption by allowing discrimination where an employer's employees are not covered by an enterprise agreement or a kind of enterprise agreement or are covered by an enterprise agreement that does not cover a union.
Have a think about that for a minute. Have a think about the impacts of that. Again, is that a cooperative workplace where one side doesn't hold all the power?
I don't know about that. I want to reference the Watson report, Rotting from the top, and what it found. Geoffrey Watson SC wrote this report into corruption and misconduct in the CFMEU's Victorian construction branch.
You'd have to be living under a rock not to see what's been happening in Victoria and the fact that Premier Jacinta Allan and the Prime Minister are pretending that there's nothing to see there—'If there's a problem, just go to the police and report it'—when in fact they are providing the cover for what the CFMEU has done in Victoria and is attempting to do in Queensland and New South Wales.
The report only became public because it was tendered to the Queensland commission of inquiry into the CFMEU. Watson found the enterprise agreement system in Victorian construction had been—and these are his words—'thoroughly corrupted', describing it as 'old-fashioned "pay to play" corruption'. Watson found that there was no genuine bargaining.
A CFMEU official told a contractor executive: There is no bargaining—no, nothing will be changed in this agreement. Again, that doesn't sound like a cooperative workplace where one side doesn't hold all the power. Watson found a number of concerning issues.
He found that the CFMEU punished enemies by refusing EBAs, with no reasons given and no avenue for review. So you can't get the job if you don't have an EBA, but, if you don't do what the CFMEU tells you, then they're not going to give you an EBA, which means they're going to cut you out. Have a think about that.
That denial of an agreement can drive a decent contractor out of business. Self-described fixer Harry Korras, recorded in an undercover sting, described how the system worked: … they control the market. The Big Build is theirs.
You can't get in if you don't know someone. The price of entry was described as follows: There's a fee to get an EBA … the upfront fee is cash. But let's protect that.
Let's make sure that that gets to continue, and let's make sure that Commonwealth government procurement defends that. What a disgrace. The lesson is not that enterprise agreements are inherently improper.
They're not. The lesson is that, where market access depends on obtaining the right union covered agreement, there is a real risk of coercion, exclusion, inflated costs and corruption—enter, stage left, Mick Gatto. That is why Commonwealth procurement should not be used to create incentives for union covered enterprise agreements unless there is a clear, transparent and evidence based connection to value for money, delivery capability, lawful compliance and productivity.
Do we really want to see in Commonwealth infrastructure projects what we have seen in the big build in Victoria? Is that what we are designing here? It appears to be.
I'll finish by putting forward some quotes from stakeholders and what they think of this bill. The Business Council of Australia said: Public money should go to businesses that can deliver, not businesses that have signed the right union agreement … The reach goes far beyond a single contract. A single Commonwealth project could impose these conditions on every business in its supply chain.
The consequences would ripple through entire industries. Master Builders Australia said: The potential exclusion of those legally operating under an industrial award including those providing above award conditions is fundamentally unfair particularly for small businesses operating in the building and construction industry, who make up 98 per cent of the industry and generally do not rely on an enterprise agreement.
This is yet another assault by the Albanese Labor government on Australian small businesses, particularly those lawfully conducting business in the construction sector. It is shameful. Finally, the Queensland Deputy Premier wrote to the minister, accusing the Albanese government of trying to revive Queensland's most controversial construction policy on a national scale, jeopardising the state's 2032 games delivery.
In the letter, he declared Queensland would not back proposed workplace law changes he claims would nationalise the former Best Practice Industry Conditions policy, which was dubbed the 'CFMEU tax'. Here we have it: yet another tax on Australians and on Australian small businesses from the Albanese Labor government.