Ucatt members on the site of Northumbria Specialist Emergency Care Hospital in Cramlington have reported that they are now working via umbrella companies. This results in them having to pay both the employee and employer national insurance contributions (more than 25% of their eligible pay).
Lend Lease is the main contractor. Balfour Beatty is the M&E contractor.
The workers are also receiving rolled up holiday pay, which means that their holiday pay is in their rate of pay and they are not paid when they take time off. In some cases workers on the hospital project are only paid the minimum wage with the reminder of their pay being made up in expenses.
Ucatt regional secretary Denis Doody said: “This is an outrageous example of exploitation of construction workers on a publicly funded project.”
The use of umbrella companies to pay construction workers has increased dramatically in recent weeks, the union says. This follows a change in the law in April 2014, when the government introduced new measures requiring employment agencies and payroll companies to pay workers via PAYE. The umbrella company model is seen as an attempt to ensure that neither the contractor, the agency or payroll company is liable for increased cost.
Mr Doody added: “Today’s protest is just the beginning of the campaign. We will be contacting the client, the contractor and local politicians in order to ensure that this type of exploitation is stamped out once and for all.”