StreetwiseSubbie is calling for government to agree a Fair Treatment Charter after a survey found that the nation's specialist sub-contractors are underpaid, undervalued and almost never paid on time.
The survey on the state of the industry, carried out by the advice and consultancy firm, showed that over the last 12 months 96% of specialist contracting firms said they were treated unfairly.
The majority of specialist sub-contractors also reported having to accept far less money than they were entitled to, but had no alternative than to accept making a loss in order to get paid.
“We set out to establish the extent to which specialist sub-contractors are bearing the brunt of the recession. What we found was that specialist sub-contractors are being systematically subjected to unfair treatment by contractors,” said a StreetwiseSubbie spokesperson.
Examples of problems experienced included 89% reporting payments had been delayed beyond the agreed terms; 65% said they had been paid less than agreed or certified; 56% had the scope of work changed but then the changes disputed.
A further 48% felt they had to enter into unfair or one-sided contract terms and 43.5% were subjected to unfair tender practices.
“The whole construction industry is at breaking point,” said StreetwiseSubbie founder Barry Ashmore.
“I have been in the industry for 40 plus years and have come through previous recessions, but never have I seen the industry in as dire state as it is today. It has always been tough for specialist sub-contractors, but the way specialist contractors are being treated today is an absolute disgrace.”
“It seems to me that the main contractors are expecting, as a matter of routine, to underpay or withhold money from those lower down the food chain. Specialist sub-contractors are given ludicrous excuses for non-payment. And the contractors think it is an acceptable way to do business,” he said.
“Those main contractors who are fair and work closely with their sub-contractors are in a very small minority. There just isn’t enough fair treatment, and it is sad to see subbie’s faith in the industry being destroyed.”
The survey also asked how much contractors had cost sub-contractors business in the last 12 months, with the majority estimating up to £20,000 and some in excess of £100,000.
”The poor practices and ruthless unfair treatment of specialist contractors identified by our survey has to be stopped for the good of the industry as whole, and to help ensure the UK’s economic recovery,” added the spokesperson.
The government tried to tackle the payment problems in December 2010 by introducing new rules requiring the main contractors working on public sector contracts to pay their sub-contractors within 30 days. But only 10% of sun-contractors working on these contracts said they are actually seeing this put into action, and most are still waiting in excess of 60 days for payment.
StreetwiseSubbie has raised concerns over the deterioration of the health of the construction industry; why government hasn’t done more to embed best practice; and why, in this time of severe economic downturn, the government has not taken a more proactive approach.
The company is calling sub-contractors to spread the word and join their campaign for a Fair Treatment Charter.
“The more evidence they see of the problems you face, the more your voice will be heard,” the spokesperson concluded.
To find out more about how to support the campaign, visit the StreetwiseSubbie website.