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By mobilizing stakeholders:
the experience of the Olympic Games,
T5 and other projects in the UK
Professor Linda Clarke
University of Westminster
educating for professional life
Characteristics of Construction Industry (UK)
• 2m employees, 9% GDP, importance of public client
• 194,000 firms: 40% = 1-person, 6% = 13+ employees, 0.06% large
• High self-employment: 36% manual, 8% non-manual;
770,000 CIS
• Recruitment and promotion: often informal +agencies
• Many little formal training e.g. 46% NVQ3 or equivalent
• Often casual, long hours
• Trade Union rate = 17%;
collective agreement coverage = 20%
Diversity in Construction
• Ethnic minorities:
– in construction = 2.8%, in economically active population = 7%
– Black Asian and Minority Ethnic (BAME) 30% working
population in London, in building trades only 12.4%
• Migrants in construction:
– estimated 10%, higher proportions in lower positions:
– non-UK labourers 8.9%, painters and decorators 8.2%,
carpenters and joiners 6.1%
– officially 110,000 foreign nationals 2006
• Survey 8,000 London construction workers 2005
– 40% from London & South-East, 7% from East England, 10%
from Ireland, 20% outside Britain
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Case Study 1: Heathrow Terminal 5
• Employment: 8,000 at peak e.g. 2006: 1,800 electricians,
plumbers, heating & ventilating engineers
• Occupational Health Assessments: 1,000+ per month 2005,
c400 health & safety inductions per week
• Laing O’Rourke: 2,500+ at peak (down to 600)
• BAME: c 10% (e.g. 200 Punjabi carpenters, Gravesend)
• Local Labour strategy: BAA commitment, but only 150
over 3 years (13 weeks+ in employment)→limited impact
• Travellers and Migrants
– ‘Travellers’ (75+km): mechanical & electrical = c50%,
construction = c70% (Wales, Scotland, north, Midlands)
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– Migrants = e.g. German, Polish, Portuguese,
Czech, Croatian
T5 Recruitment & Skills Problems
• Low training levels:
– Skills centre with BAA support, but traditional apprentices, only
50 capacity, NVQ2
– On-site training: e.g. language & numeracy,
– Actual apprenticeships: e.g. T5 major contractor = 1:250/1000
• Skill requirements for wider occupational profiles
→facilitating mobility/relocation and reduced turnover e.g.
groundworks = steel-fixing, plant operation, scaffolding,
paving, drainage, banking, concreting
• Recruitment criteria = skills & security (not qualifications),
• CSCS test centre 28 days, 3 attempts, geared to skilled
migrant recruitment
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T5 Employment conditions:
• Collective agreements: major projects agreement set
standards for all contractors, few disputes/days lost
• High employee/TU involvement high membership &
presence, joint show stewards committee (26 stewards)
• Direct employment, no self-employment
– e.g. main contractor 70% direct employment;
– M&E contractor 60% direct employment, 40% contract (agency)
• Long hours:
– site hours 7am-7pm weekdays, 7am-4pm Sats;
– normal = 50+ (WTD opt out) + travel time (min. 2 hours)
• Different rates: lack pay harmonisation
e.g. lower wages for E. European, ‘multi-skilled’ German;
• Health and safety: excellent record
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Case study 2:
Olympics
• 40 prime Tier 1 contractors (1,433 contracts), 3,000
significant subcontractors (7,500 Tier 2 contracts)
• Park: workforce 7,000 at peak
• 2007 Memorandum of Agreement between ODA
and trade unions because disaggregated strategy
preferred to T5 with commitment to ‘ethos of
directly employed workforce’ educating for professional life
Actual employment practice on Olympics
• Widespread self-employment and use of agencies at start
• 2008, removal self-employed workers by Tier 1 of Tier 2
subcontractors not complying on Park (not Athletes
Village), but survey 508 workers 2011 found 70% directly
employed, 16% self-employed and 14% agency
• Limited gains from MoA and IR Code of Practice though
union presence on sites:
– Nationally agreed rates as minimum
– Payment by results permitted but no site-level bonus
– Audits checking compliance
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e
Case Study 3: NAECI agreement
• Site/project councils and National Shops Stewards
Committee play crucial role
• NAECI 2010-2012 audit and foreign contractors
emphasised and strong regulation but cost pressures:
– “On all Major New Construction Projects where there is a monthly
audit of pay levels of all contractors, this may be carried out by a
qualified independent auditor appointed by the client or managing
contractor.”
• Regulation of training/working conditions/wages critical
but differences with posting and agency work:
– “Employees with non-UK training, qualifications and/or
experience shall be assigned to the most appropriate of Grades 1-6,
taking into account all relevant sources of information about the
individual concerned.”
Challenges to the agreement
• 2009 Review of Productivity and Skills in UK Engineering
Construction found productivity variable, skill shortage, and NAECI
rules not always enforced
• Disputes: “denial of access to workforce’s core workload and
potential social dumping” (Unite) at Langage and Staythorpe Power
stations and Lindsay Oil Refinery
• Union demands to transpose Posted Workers Directive into UK law
• Fawley: Esso not NAECI client; Redhalls offering temporary work to
pipefitters, welders, platers and riggers at one off hourly rate; local
unionists excluded and blacklisted
• Recognition of need for integrated team working, Hinkley Point
Engineering Construction Sector Agreement with EDF:
“The agreement requires contractors to establish integrated teams,
each with a specified skills mix, set up to meet the project pathway
and deliver the project’s planned scope, schedule and cost
requirements to the required safety and quality standards.”
Conclusions
• Positive major agreement employment policies :
– encouraging diverse workforce, local labour, developing skills;
– good employment/working conditions e.g. direct employment,
collective agreements, TU role, health and safety controls, audits
• Results: disappointing
– poor apprentice/training & local labour record
– predominantly white male ‘travelling’ & migrant workforce
• Obstacles : projects structured for itinerant workforce:
– Inappropriate training
– Means of recruitment – agency, informal
– Long working hours
Alternatives:
– Comprehensive monitored agreements on pay and employment
– Targeted recruitment
– Regulated working hours
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– Integrated team working