Hudson Contract’s very own Bradley Wiggins
Over the May Day bank holiday weekend our Contracts Director, Ian Anfield, together with Spencer Gorton, Contracts Manager for Dodds, took on the challenge to cycle the 220 miles between Newcastle and Edinburgh – route known as Coast & Castle route.
“Two reasons prompted me to jump on my bike, one was the adventure of the route, but the other reason was to raise some money for the Anthony Nolan Trust.” Ian said.
“They are an organisation that’s fairly close to me, so taking on this cycle challenge, means that I can hopefully help a few people find a match.
“The Anthony Nolan Trust funds the bone marrow and stem cell transplant register for people who suffer blood cancer, they receive no government funding so without donations many people would simply die.
If you would like to make a donation, payments can be made directly to The Anthony Nolan Trust:
Bank Name: Barclays Commercial Bank
Bank Address: Level 11, 1 Churchill Place, London, E14 5HP
Account Name: The Anthony Nolan Trust
Account Number: 53571408
Sort Code: 20-00-00
Please quote reference 1722341 so Ian can see how much he has raised.
No donation is too small, you can visit Anthony Nolan Trust to see what your money will do.
Freelance Builder Pay Trends: May 2013
Hudson Contract delivers the most accurate indications of pay trends across the construction industry, using payroll data for over 2,200 construction companies and over 125,000 freelance builders to publish the average pay for the full spectrum of 17 different trades across five regions.
For the first time in 2013, all five Hudson Contract regions report an upward turn in average earnings:
• The South-East leads the way with an increase of almost 8%
• Next comes the Midlands, where earnings are up by 6.3%
• The North-West and the North-East both report increases of over 4%
• The South-West is this month’s ‘poor relation’ with earnings growing by just 2.7%.
Good news? Actually, it’s more of a mixed picture.
While the UK has side-stepped the dreaded triple dip recession, the fact remains that the construction sector is showing no real improvement. Comments Hudson Contract Managing Director David Jackson: “Trade group surveys continue to report downturns in business activity and falling numbers of new project starts, so the increases might have more to do with the improving weather than any construction sector recovery.
“Better weather also meant that housebuilding activity perked up during April. In fact, the latest quarterly NHBC registration figures report that 31,739 homes have been registered in the UK, which is 5,741 up on this time last year, and the highest quarterly level since 2008.
Are we turning the corner?
“So hopefully, this is a turning point for construction, where we have finally turned the corner and are poised for a gradual recovery. As always, I look to the barometer of our industry – bricklaying – for signals, and note that earnings in all regions increased during April, soaring by over 20% in both the North-East and the South-West.”
Other trades that have had an exceptionally good month include:
• Plasterers in the Midlands: +22%
• Shopfitters in the North-West: +21%
• Joiners in the North-East: +20%
Biggest losers
And at the other end of the scale, three particular trades have all seen the largest cut in average earnings and are also now on the lowest national rates for their trades:
• Plasterers in the North-West: -20%
• Surfacing contractors in the North-East: -16%
• Electricians in the South-West: -16%
click here to see this month’s paystats
The false claims about false self-employment in construction
Since 2008, UCATT has repeatedly claimed that between 300,000 and 400,000 people are falsely-self employed in construction. Their claim has always been one of prejudicial guesswork, which needs, therefore, to be challenged.
It’s a theme that has been taken up by the Labour Party: Ed Balls speaking at last year’s TUC Annual Conference pledged that his party would revisit the whole issue of bogus self-employment in construction, based on more up-to-date responses from the unions – and employers.
So clearly, the Labour Party is listening to the union claims. But they are not, however, taking the numbers being bandied around at face value.
Labour asks Hudson Contract to advise
I was very pleased to receive an invitation from Rachel Reeves MP, Shadow Chief Secretary to the Treasury, to contribute to the Labour Party review by giving opinion and evidence of false self-employment.
And as Managing Director of Hudson Contract, with over 2,000 construction firms using our service to engage self-employed/freelance builders I feel I am well-positioned to put a more objective, better reasoned and professionally-evidenced assessment into the political landscape.
The request from the Labour Party was timely, as I have been working over the past six months with Andrew Burke, Professor of Economics at Cranfield University and Director of the Bettany Centre for Entrepreneurship to produce a second – quantified – edition of his paper The Economic Role of Freelance Workers in the Construction Industry.
To bring his research up-to-date, Professor Burke visited major construction projects, interviewing 42 specialist contractors and identifying 712 labour-only subbies – aka freelance builders – in the workplace on contingent contracts.
All 712 met the criteria of their freelance categorisation, begging the question: “So where, exactly, are the many thousands of people alleged to be falsely self-employed actually working?”
The value of labour-only subbies to the construction industry – and their contribution to the UK economy
I continue to wait for UCATT to substantiate the numbers they are so fond of bandying about. While on a more positive note, key findings of Professor Burke’s research reveal:
• Freelancers enable greater de-risking of projects, which is a key element to enhanced entrepreneurial performance, predominantly achieved from output-based payments
• Specialist freelance labour reduces downtime by as much as 80%, which in turn reduces construction costs and promotes competition
Professor Burke has also been advising the Labour Party directly on the economic value of freelance builders to the UK economy, and has also presented his paper to a panel of civil servants and business leaders at the Department for Business Innovation & Skills.
Hudson Contract meanwhile, has submitted our comprehensive and evidenced response to Rachel Reeves. It has been acknowledged – with thanks – and we await the outcomes of the Labour Party review.
I have also met with David Gauke MP, chief secretary at HM Treasury to discuss the findings of the Burke Report, and was able to give my reasoned opinion on the more likely – and far lower – number of self-employed people in construction who, on proper analysis, could be classified as bogus.
Looking to the future, Professor Burke and I are scheduled to return to the BIS during the coming months to continue our dialogue, and to highlight the many and various benefits of having freelance builders in the workplace.
And my over-riding message? If any party fails to recognise the value added to the construction industry by freelance builders, the number of those who could be classified as falsely self-employed will never be correctly seen.
The Burke Report is available at: www.freelancebuilders.co.uk/about-us
The Hudson Contract family continues to expand…
During the last financial year, Hudson Contract has gained 351 new clients.
To each and every one, we say thank you for choosing us, and for trusting us to eliminate your tax and employment law issues.
Among those who are now using us to engage their labour-only subbies are:
• 106 general builders
• 32 civil engineering firms
• 28 electrical firms
Hudson Contract Managing Director David Jackson comments: “I am especially pleased that about half of these new clients have come to us by way of recommendation.
“Word of mouth is always hugely appreciated because it lets us know we’re getting it right.
“On a sad note, though, we have also said goodbye to seventy-two firms that are no longer trading, due to retirement, but in about thirty cases liquidation.”
During the same period an additional 20,981 freelance builders have signed Hudson Contracts and started work on our clients’ sites. As you would expect, each and every one has had their status verified and accepted by HMRC.
Click here to discover how existing clients profit when they recommend Hudson Contract
Freelance Builder Pay Trends: April 2013
Hudson Contract delivers the most accurate indications of pay trends across the construction industry, using payroll data for over 2,200 construction companies and over 125,000 freelance builders to publish the average pay for the full spectrum of 17 different trades across five regions.
Yet again, the pay trends tell a story of mixed fortunes – and in a reversal of last month, four regions are down with only the South-East reporting a small upward trend of 1.39%, in contrast with the North-West, where average earnings have tumbled by 3.69%.
Looking at individual trades across all five Hudson Contract regions, a mixed picture also emerges:
• BRICKLAYING: Up 22% in the South-West – but down 19% in the Midlands
• SHOPFITTING: Down 19% in the North-East – yet up 12% in the North-West
• ELECTRICIANS: Up 16% in the South-East – but down 14% in the North-West
In terms of the bigger picture, what does it all mean?
Ten months of contraction – but better times ahead?
Comments Hudson Contract Managing Director David Jackson: “To a certain extent, these decreased earnings are a reflection of the recent unseasonal wintry weather in some of the country. Although having said that, other new construction statistics also sound a loud note of caution.
“It’s positive news that industry insolvencies are down 5%, as reported by accountancy firms PwC, on the last quarter. But on the other hand, the latest monthly survey from Markit/CIPS UK shows output is continuing to decline and new business has fallen for the tenth consecutive month.
“The real issue we are now seeing is that as projects come to an end, there simply isn’t sufficient new work out there to replace them. And whilst the budget didn’t grant our wish of a reduction in VAT on renovations, the support given to infrastructure and housebuilding is a positive boost to the industry, although as we all know, it will take time for the practical impact to filter through.”
Survey responses reveal industry pressures
No-one likes losing a client – and Hudson Contract is no exception. So we recently contacted 100 firms that had not been using our services for a while to find out what had happened. We received sixty-four replies.
Here’s what we discovered:
• Thirty-nine firms (61%) explained they simply didn’t have enough work to warrant contracting additional subbies with Hudson Contract. Most were getting by with a nucleus of directly employed labour, although a handful had reverted to being a one-man business.
• Of these 39 firms, around one third were optimistic about growth, having noted a sharp rise in requests for quotes.
• Nine clients (14%) had unfortunately ceased trading: two had simply closed their business and retired, while the remaining seven had gone into liquidation.
• Six clients returned to transacting with us in the last couple of weeks. Naturally, we’re delighted – and this is perhaps also a sign that business is picking up in some areas.
As for the other ten who replied:
• Four say they have decided to pay their subbies themselves
• One firm has put all its skilled tradesmen on the books as employees
• One client has “fallen out with us over Manchester United” (don’t ask!)
• The remaining four say have gone to another service provider
Penny wise and pound foolish?
Comments Hudson Contact Managing Director David Jackson: “I freely admit you can’t win ‘em all, but of the four who have left us, I can’t help but wonder why on earth a business owner-manager or director wants to risk HMRC fines and employment tribunal awards when the financial penalties can be so high. Is it a case of penny wise and pound foolish?
“Our service undertakings in these aspects of status law are absolute, certain and guaranteed. Quite simply, Hudson Contract eliminates the risk – guaranteed – as opposed to merely managing it, whereas any other service offering puts a construction firm at risk.”
Employment Tribunal Update: Tales from the front line
During my five years with Hudson Contract, I’ve been to more employment tribunals than I’ve had hot dinners.
OK, so that’s something of an exaggeration. And thankfully, I have always been on the winning side.
But the fact is, even operatives who are legitimately self-employed can – and do – mount tribunal challenges, making it no surprise that tribunal cover is the second biggest reason (behind tax compliance) why construction firms choose to do business with Hudson Contract.
Licence to print money
Tribunals were set up with the best of intentions, giving employers and employees an opportunity to resolve workplace grievances quickly and fairly. But as the years have passed, they have turned into an entirely different animal – with claimants, trade unions and no-win-no-fee lawyers often regarding them as a licence to print money, even in the flimsiest of circumstances.
And even though I consider myself a seasoned tribunal-goer, I often come away from a case amazed at the language and logic of the system.
For example: Read more »
Hudson Contract clients share £16,000 payout
You might remember that Hudson Contract’s New Year’s Resolution was to give away a record £45,000 to clients by way of our Rewards Scheme. The good news is that in March alone, we wrote out cheques totalling over £16,000 to firms that have recommended us to their construction colleagues and contacts.
Some of latest Rewards we’ve handed out include: Read more »
Freelance Builder Pay Trends: March 2013
Hudson Contract delivers the most accurate indications of pay trends across the construction industry, using payroll data for over 2,200 construction companies and over 120,000 freelance builders to publish the average pay for the full spectrum of 17 different trades across five regions.
Earnings edged up upwards this month, returning to positive figures in four of our five regions, with only the North-East reporting a fractional decrease of less than one per cent.
Hudson Contract Managing Director David Jackson observes, “That’s in contrast to the latest Chartered Institute of Purchasing and Supply figures, which reveal British construction output fell in February at the fastest pace in more than three years.
“It highlights the importance of maintaining a flexible workforce, that enables contractors to compete cost-effectively for the work that’s out there, whilst minimising the impact of downtime when contracts are scarce and during bad weather.”
This month’s winning trades:
Sixty per cent of the 85 regional trades saw an earnings increase in February. Big winners include:
• Surfacing contractors in the North-West +18%
• Plumbers in the Midlands +16%
• Electricians in the South-West +15%
This month’s losing trades:
Perhaps because the weather was better across the South of England, most of those whose earnings have fallen are in the North and the Midlands. Significant earnings drops include:
• Specialist trades in the North-East -16%
• Specialist trades in the Midlands -14%
• Roofers in the Midlands -12%
Seasonal winners
“One of the winners across all regions this month is surfacing contractors – but that’s no real surprise,” David Jackson says. “Due to the constant temperature changes, our roads take a real hammering in winter, and it’s a never-ending task to fill in all the potholes. As daylight hours increase, it becomes possible to fully resurface in a single session, hence demand – and earnings – rise.
“Equally, the highest-earning trade this month is one that works mostly indoors – shopfitters – whose weekly rates were around £900 in the Midlands, the North-West and the South-West.
“It’s also worth noting that while the general earnings trend is slightly upwards, bricklaying rates – always regarded as the barometer of our industry – are down everywhere, with the exception of the North-East. There is every reason to continue to be cautious as we move towards Spring.”
Hudson Contract helps new client get £4,000 employment tribunal claim withdrawn
So what happens when a labour-only subbie decides to take you to an employment tribunal? It happens more often than you would imagine – and it happened recently to Andrew and Peter, directors of a Midlands fabrication firm.
I met them because they were already engaging a number of labour-only subbies on a contract-to-contract basis and felt nervous about the consequences of their contracts failing to pass HMRC scrutiny tests. Following a meeting with their accountants, it was suggested that they should seriously consider using Hudson Contract.
It was while we were discussing that every Hudson Contract client gets a 100% guarantee – meaning that if a freelancer mounts an employment tribunal challenge, we are liable for all financial consequences – Andrew and Peter became extremely animated.
A person who had worked for them on a number of contracts had left to join another firm, and as a parting shot, he had presented them with a demand for two years’ worth of holiday pay. He had already spoken to the government-funded Advisory, Conciliation and Arbitration Service, ACAS, and they had advised him he had a case for citing ‘workers rights’, even though he had been engaged and taxed as self-employed throughout his time with the firm – and a claim for over £4,000 had been made.
Having sought legal advice, Andrew and Peter had already offered the individual a £500 settlement which was declined, and when we met, they were in the process of putting together their defence, ready to defend the claim themselves.
Hudson Contract has never lost an employment tribunal case Read more »