CPB Contractors has told a probe into CFMEU's alleged past wrongdoing in Queensland that the Best Practice Industry Conditions (BPIC) introduced by the state's former Labor government hit hard.
The company added $23 million for higher wages and conditions and another $11 million for delays linked to BPIC on a Bruce Highway upgrade near Gympie, CPB executive Vince Sanfilippo said on Wednesday .
He said the BPIC rules, drawn from a CFMEU "minimum standards" document, helped push up the price of the job.
The inquiry is examining how the Queensland government has dealt with unions, contractors and workplace laws on major infrastructure projects.
It is looking in particular at whether the now-scrapped BPIC were developed lawfully and whether any group – including unions – had undue influence over government decisions.
The commission has heard damaging evidence from public servants, union officials and industry figures.
Mr Sanfilippo said he was "disappointed" to see the CFMEU's minimum standards carried over into transport projects.
CPB had bid for the Bruce Highway upgrade near Gympie and believed it was in the box seat with the lowest tender, he said.
But in late 2020, the Department of Transport and Main Roads began asking unusual follow-up questions, including how subcontractors would be managed, the industrial relations risks on the job and how rostered days off would work.
"We weren't used to seeing questions of this nature come back from Main Roads," Mr Sanfilippo said.
He said the new rules forced CPB to rethink its tender, adding $23 million to cover extra wage and condition costs linked to BPIC and seeking about $11 million more because delays over BPIC pushed the project into an extra wet season.
Those changes lifted the overall price of the job by roughly 13 per cent, even though CPB adopted a "conservative" version of BPIC that applied only to its own employees, not subcontractors.
Main Roads deputy director-general Amanda Yates later contacted him and said the government had concerns about CPB's industrial relations record, including on the Cross River Rail project.
She also said BPIC would now apply to certain transport tenders.
Mr Sanfilippo said he warned her that forcing contractors to ensure everyone on site was paid at certain rates would, in CPB's view, be illegal.
"Ms Yates advised me in subsequent conversations that my understanding of the legal and code implications was correct," he told the inquiry.
That same day she emailed him a confidential draft policy.
It said KPMG had analysed civil construction enterprise agreements, standard department contract conditions and a CFMEU "minimum standards" document to develop the proposed conditions.
"To see it in bold print and the CFMEU drafting the minimum conditions was certainly interesting and disappointing," he said.
The inquiry heard industry was not consulted while the draft was being developed, but unions were invited to suggest changes, which were marked up in colour.
Commissioner Stuart Wood KC questioned why consultants and union enterprise agreements were used to set "minimum" conditions instead of simply relying on existing awards.
He is expected to deliver his final report to the Queensland government in July.
