Key Issue

THE RISKS OF NON-DIRECT EMPLOYMENT CANNOT BE IGNORED

With construction vacancies at a record high, Daniel West, Managing Director of West & West, argues the case for direct employment.

West & West wholeheartedly supports these calls for action and the need to use the right employment model According to the latest figures from the Office of National Statistics (ONS), the construction skills shortage has intensified. From June to August 2021, vacancies rose to 37,000 – the highest level since official records began in 2001.

Although there is no silver bullet to overcome this challenge, the shift to direct employment is part of the solution. Now, more than ever, we need to build awareness of directly employing tradespeople and the additional benefits this can bring to construction, including electrical contracting.

Negative consequences

A report published by the Joint Industry Board (JIB) earlier this year, underlined the risks of non-direct payroll working. Over the past 30 years, the UK has seen levels of direct employment significantly decline and this is having a negative impact on the UK electrical contracting and construction industries.

Written by Howard Gospel, Emeritus Professor of Management at King’s College London, the report, DirectEmployment –Astudy ofEconomic, Business and Social Outcomes urges contractors and clients to enforce direct employment into their workforce to improve productivity.

Acknowledging that non-direct working offers firms some short-term conveniences, the report reiterates that these are outweighed by potentially negative consequences affecting areas such as apprentice training, take up of new technologies, health, safety and wellbeing.

In its Industry Skills Plan 2021-2025, the Construction Leadership Council (CLC) highlights the benefits of direct employment, stating that it “delivers a highly-engaged, competent workforce, increased productivity and higher value”. It also notes that it is “reported to overcome skills shortages, spiralling labour costs, poor productivity and quality, avoiding low uptake of new work processes and technology…reducing risks around delivery certainty, reputation and quality”.

It is up to employers to offer attractive enough roles with additional benefits

Enhancing skills

As an electrical contractor that has always prioritised direct employment, West & West wholeheartedly supports these calls for action and the need to use the right employment model to help support quality, innovation and safety. And the company believes that all building firms – large and small – should set an example.

West & West has learnt first-hand that employing people directly, as opposed to relying on subcontracted or agency staff, makes a fundamental contribution to the individual’s skill levels and abilities.

At West & West, all direct employees are given the opportunity to undertake additional training and professional development in areas that interest them, ranging from electrical design, through to security systems and fire safety. The company also offers courses in management training to equip employees with the attributes and mindset needed for career development – whether this is with the company or elsewhere.

As well as helping them to upskill, this investment in training ensures its people feel valued, encouraging motivation and loyalty.

A cultural fit

Another key benefit of directly employing staff is the opportunity to select individuals with the right attitude for the business and its culture. Finding an individual who is proactive, motivated and capable of working collaboratively is initially more important than them having all the required technical skills, as these gaps can be filled later.

Whether someone joins West & West as an apprentice or later on in their career, as direct employees they learn the company’s approach to the trade and its expectations in terms of quality of work and attitude, which is to go above and beyond client requirements.

Relying on subcontracted and agency staff risks a low commitment to the job and them leaving part way through. West & West’s experience has also shown that temporary staff, who are unconnected to the company long term, are not versed in the standards and work ethic necessary for each project’s success. They are more likely to turn up and do a day’s work with minimum effort.

Investing in the workforce

When there is a recession or dip in economic circumstances, people will often follow the work and be more likely to take on agency or subcontracted jobs. That means it is up to employers to offer attractive enough roles with additional benefits in terms of induction, training and development to encourage individuals to stay and prosper with the business.

West & West has found that this investment has proved crucial during the pandemic, enabling the company to recruit more people. While other companies have laid off staff, West & West has increased its recruitment activity, enabling the company to bring on the best in the industry and offer individuals job security in tumultuous times, as well as continued professional development opportunities.

Seizing the opportunity

The authors of the foreword in the JIB report state they want it to become “a catalyst to action in the work we are all embarked upon to create a more innovative, productive, sustainable, and attractive industry”. The recommendations present an opportunity for electrical contractors to eliminate the risks associated with non-direct employment and build highly-skilled workforces with the right attitudes and mindsets to raise standards across the whole construction sector.