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Tue May 24 2022

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Crossrail contractor accused of breaching direct employment protocol

26 Feb 21 The mayor of London has been asked to intervene to block the use of self-employed electricians on Crossrail’s Bond Street station site.

Artist's impression of the new Bond Street station tickethall
Artist's impression of the new Bond Street station tickethall

According to the Unite union, Bond Street is breaching protocols governing the building of Crossrail – specficially the requirement for all workers to be directly employed (standard PAYE) and paid per the relevant national construction agreement.

Principal contractor at Bond Street station is now Engie, which has taken over the job from Costain Skanska joint venture. Unite says that Engie has let go directly employed electricians engaged by subcontractor NCCT and kept on self-employed ones.

By using self-employed workers, companies avoid paying national insurance contributions (13.5% of earnings) as well as holiday pay and sick pay.

Unite says that it has tried and failed to resolve its concerns with Engie’s senior management and is now going to the client organisation and the ultimate client, London mayor Sadiq Khan.

Unite national officer for construction Jerry Swain said: “Unite has had reassurances from Crossrail that the rules on direct employment remain in place. It is now essential that Crossrail takes decisive action to ensure its rules are upheld and this misuse of taxpayers money is immediately ended.

“Rules on directly employing workers are essential in construction as it creates a level playing field and prevents works being exploited, ensuring they receive basic employment rights such as holiday pay.

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“It is highly disturbing that the direct employment rules appear to be being ignored and it is essential to ascertain if any company on Crossrail is boosting its profits by not employing workers correctly.

“Taxpayers will be alarmed that it appears that work is being tendered on the basis of direct employment but workers are being recruited on cheaper inferior terms. This must be fully investigated.

“Unite has contacted Sadiq Khan directly. The London mayor is ultimately responsible for the Crossrail project and should be highly concerned that such practices are occurring on his watch.”

A spokesperson for Engie subsequently said: “As a company, we comply fully with all contractual obligations. We will always endeavour to ensure that staff and subcontractors who work on projects that are under our control are paid in accordance with their contract of employment and subcontract agreements. Following engagement with our subcontractor NCCT we have received written confirmation of their full compliance with JIB requirements and accreditations.” 

A report by the Electrotechnical Joint Industry Board earlier this month set out the economic case for direct employment. It said that the increasing prevalence of self-employment, casual labour and off-payroll working has damaged construction productivity and skills. It is a call that is no longer just coming from the unions. Many bosses also now recognise that reform is overdue. The Construction leadership Council, co-chaired by the government’s business minister, says that direct employment is essential for an adequately trained and competent workforce.

And earlier this week the Institute for Public Policy Research called for a parliamentary commission to investigate options for tackling ‘bogus’ self-employment in the construction sector.

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