Beyond the Minimum – ACTU Response to the Draft Department of Finance Supplier Code of Conduct

As the submission below outlines, unions are concerned that the draft Code indicates what we believe is a lack of ambition for procurement policy. It simply outlines a procurement system that requires all the suppliers within it are law-abiding. Working people expect more – both from suppliers to Government and from Government’s purchasing power. Below are a series of recommendations regarding areas which the code could be expanded to realise greater value from every dollar spent.

To implement the Code as drafted would represent a significant missed opportunity to ensure there are broader and more tangible benefits to society and the economy and realise Australian values through every dollar spent by Government.

Union views on the Draft Code

Compliance with legal minimums

The current draft of the Code is limited to what appears to be its main objective: to require that suppliers to the Government, who are receiving public money, meet the minimum standards which they are largely already legally required to meet. For example, the expectations under the draft Code with regard to health, safety and employee welfare are:

• Manage workplace health, safety and security Suppliers must comply with all applicable workplace health and safety laws and ensure they are providing healthy safe and secure work environments for their personnel.
• Act to prevent involuntary labour and human rights abuse – Suppliers must take all reasonable efforts to ensure that they, and organisations in their supply chain, are not engaged in, benefitting from or complicit with, human rights abuses such as coercion, involuntary and underage labour or modern slavery practice as defined in the Modern Slavery Act 2018. This includes undertaking risk assessments to identify the risk of human rights breaches, particularly in vulnerable industries.
• Act to prevent discrimination and harassment – Suppliers must not discriminate based on age, disability, ethnicity, gender, marital status, political affiliation, race, religion, sexual orientation, gender identity, union membership, or any other status protected by law, in hiring and other employment practices. Suppliers must also ensure their workplace is free from bullying and harassment and have processes in place to support the disclosure and management of such practices. Suppliers are expected to improve gender equality in the workplace and support a progressive and diverse work force.
• Respect employee rights – Suppliers are expected to respect the rights and entitlements of their personnel and comply with all relevant workplace legislation. This includes:
  • ensuring that their personnel receive their entitlements on time including, but not limited to, wages, minimum wages, overtime, benefits, superannuation, leave, working hours and compensation; and
  • allowing their personnel to form, join (or elect not to join) unions, industrial organisations and other worker collective associations of their choice, bargain collectively and engage in lawful industrial activity without hindrance or threat of retaliation.
• Respect Aboriginal and Torres Strait Islander peoples’ rights – Suppliers are expected to respect the rights of Aboriginal and Torres Strait Islander peoples and engage with them where their business activities may impact them. Suppliers are also encouraged to consider using Aboriginal and Torres Strait Islander businesses when subcontracting to help stimulate Aboriginal and Torres Strait Islander entrepreneurship, business and economic development.

These requirements can be broadly summed up as mandating that suppliers to government should obey workplace health and safety law, uphold modern slavery conventions, obey anti-discrimination law, adhere to freedom of association laws and support Indigenous Australians. With the exception of the last point, each of these is merely an expectation that the supplier should meet minimum legislated standards they are already obliged to meet. There appears to be no requirement or criteria about how suppliers demonstrate their compliance with the law nor is there substantive and transparent auditing provisions to ensure continued compliance.

More importantly, this represents a lack of ambition – both for the behaviour of suppliers to Government and for what can be achieved through a more strategic and values-based approach to procurement. Fundamentally, the Australian government should be setting best practice standards and expectations for businesses receiving public money. It should focus on encouraging the best Australian businesses who have shown a commitment to excellence in their products and services, but also in their commitment to their employees, the environment and the broader society. Even more than that, the Code should not be a simple tick-box exercise but should provide public servants with information relevant to their procurement decision.

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