Australians are heading to the polls on July 2 unless the Senate passes laws to tackle union corruption.
On the advice of the Prime Minister, Governor-General Peter Cosgrove has used his constitutional powers to recall both houses of Parliament for a three-week sitting from April 18.
Prime Minister Malcolm Turnbull wants the Senate to use the sitting - which will include the federal budget on May 3 - to pass bills reinstating the Australian Building and Construction Commission and ordering higher penalties for union corruption. If the bills, which have previously been rejected, are not passed then a double-dissolution election will be held on July 2.
"What we are doing here is giving the Senate ample time ... to consider the bills and pass them," Turnbull told reporters in Canberra.
"If they don't want to pass the bills then they should resolve to reject them and then the decision will be left to the Australian people."
If the bills are passed, an election of the lower house and half the Senate will be held at the normal time, in August or September.
Turnbull said cleaning up the construction industry was crucial to the Australian economy and job creation. "The issue in the election is who do you believe is best able to continue successfully to manage Australia's economic transition," he said.
Turnbull finalised the plan on Sunday night and briefed his cabinet on the decision on this morning, just after Treasurer Scott Morrison went on Sydney radio to state the budget would be held on its scheduled date of May 10.
Labor and the Greens have been firm in their opposition to the industrial laws, saying the Government shouldn't be singling out one industry and that the building commission's powers go well beyond a court.
The Government needs six crossbench senators to pass the bills, but months of talks have been unsuccessful in delivering all of their votes. Independent Nick Xenophon said he would support the ABCC with amendments. "We should just get on with it," he told reporters in Melbourne.
The latest Newspoll has the coalition ahead of Labor 51-49 per cent on a two-party basis, but Turnbull's net personal approval has crept into negative territory for the first time.