‘In your corner’

The future may be uncertain for about 20,000 directly employed UK workers of outsourcing firm Carillion after its collapse, but there’s an even bigger question mark hanging over Carillion’s subcontracted staff.

Like many construction companies, Carillion paid a substantial portion of its workers through what are called umbrella companies – effectively in a bid to dodge taxes and rob workers of their employment rights.

Technically employed by the umbrella company, workers are forced to pay both employers’ and their own national insurance contributions, and other fees deducted by the company for processing their pay. They don’t enjoy the same entitlements as their directly employed counterparts, such as paid holidays.

The Daily Record spoke to one worker who worked for Carillion – he was brought on the Shotts railway electrification project in Scotland through an agency called Carillion Rail Resources – but was paid through an umbrella company.

“We were effectively Carillion employees without the rights of someone employed by Carillion,” the worker told the Daily Record. “We wore Carillion clothes, did the same work – everything was the same apart from our pay packets and our workers’ rights.

“Crest took £17 off you to process your wages and sometimes it could be £25 depending on how much you earn.”

The worker highlighted that the umbrella company payment structure meant Carillion didn’t have to pay its own national insurance contributions that it would have had to had it employed him directly.

‘It’s a scam’

“It’s a scam and pretty galling that they were effectively shafting the taxpayer while being paid fortunes to do public sector contracts,” he said.

Through umbrella companies, construction workers lose out on, in some cases, thousands of pounds a year. Now, it’s been conservatively estimated that nearly half a million construction workers are paid by umbrella companies, which flourished after 2014 self-employment reforms.

Unite regional officer Graeme Turnbull slammed the employment practice, especially in light of Carillion’s public sector contracts. “It’s disgusting that public money is being creamed off by fat cats at the top in vast sums while the guys at the bottom are left struggling,” he said.

The Herald spoke to another worker, Alan, who also was paid via umbrella companies as a track worker on Edinburgh’s Waverley station platform extension project. Alan explained that he works for a subcontractor of Carillion but the payment of his wages is outsourced to two different companies, which complicate getting back the unpaid wages he is now owed.

“Your pay is certainly subcontracted out several times removed,” he said. “You phone about your money and one lot blames the other.” Last week, Alan said, he and his colleagues were meant to be paid for the work they did over the Christmas and New Year holidays.

He said he received a text message from a firm working for Carillion’s liquidator saying that they had paid his wages – but he has yet to see the ÂŁ3,500 he is owed. Turnbull told the Herald that he worried these workers who are now owed money will be classified as Carillion’s creditors. “There is a story that every one of the creditors is just going to get a penny for each pound they are owed,” he said.

Unite national officer for construction Jerry Swain urged workers to press on in their fight for justice with Unite, which is determined to do all it can to claw back wages for its members.  “I say to construction workers who were employed by Carillion or a subcontractor and are awaiting their wages – you’ve done the work; you’re entitled to be paid.”

“If your contractor can’t pay you because Carillion can’t pay you, then the client who appointed Carillion will have to dip their hand in their pocket,” he said.  “They’ve had the work done and our members expect to be paid for that. I urge members to stay and fight their corner alongside Unite as we sort this out.”