Construction Professional

Getting the best from solo performers

As self-employment takes hold in the industry’s professional ranks as well as on site, Jason Farnell says tier 1 contractors will have to learn a new tune

WHEN I STARTED working in the industry as a pupil quantity surveyor in the north of England, my employer – in common with most if not all main contractors at the time – employed a large number of direct employees for all of the traditional building trades, such as bricklayers, scaffolders, steelfixers, concrete gangs, carpenters and joiners. The packages that were sub-let at that time were the specialist mechanical and electrical works, structural steelwork, plastering and decorators. At the start of every project the debate about “self-delivery” or sub-contracting for these traditional trades was fiercely contested; direct control and skill sets were weighed against certainty of out-turn cost and risk transfer. Gradually the economic burden of having a large “hungry mouth to feed” irrespective of the availability of suitable opportunities in the market place became irresistible and main contractors made the structural and cultural change towards sub- contracting 80% of construction projects which is prevalent currently. This leaves only the balance of management, preliminaries and welfare, risk, overheads

and profit in the direct control and influence of the main contractor. It seems that the next challenge facing

major contractors is already starting to bite: how to deliver major projects with management teams who are not directly employed – the construction nomad. Employment trends have been changing gradually over the last 10 years. People are no longer looking for lifetime employment with a single company, and if they were these companies aren’t able to deliver that level of continuity. Young people entering the industry are pursuing career paths and are driven by gathering experience, knowledge and skills to meet emerging demands and opportunities. On the softer side, people want to take control and be independent and self-sufficient.

A growing trend On projects with our contractor clients we are seeing 30-50% of construction teams across all disciplines of management, engineering, surveying and co-ordination being made up of freelance workers. This is a trend we can only see growing. The management of major construction projects is complex – main contractors

“We are seeing 30-50% of management teams made up of freelance workers. This is a trend we see growing”

have always had the challenge of bringing groups of individuals together to form teams and to deliver one-off projects, then moving those individuals on to the next job to form new teams and begin the process again. With stable, directly employed work forces, trained in company systems and processes, this was difficult enough, but with no direct continuity of employment linkage this is magnified. Main contractors operate on slender

margins and it is vital to the successful delivery of these returns that their control systems and reporting are both effective and reliable. This reporting will

What do I need to know about The Minimum Energy Efficiency Standard?

The proposed Minimum Energy Efficiency Standard (MEES) legislation in England and Wales was placed before parliament last month. It will require all properties to achieve a minimum energy performance certificate (EPC) rating of E by April 2018 before a lease event can take place. With around 18% of the property market

in England and Wales currently below this level, this legislation will have an impact on both occupiers and landlords. Given the relatively short timescales involved,

24 | APRIL 2015 | CONSTRUCTION MANAGER

portfolio assessment is required imminently. For the first time, fines for non-compliance

will be directly linked to rateable value, with between 10%-20% of rateable value capped at £150,000. Depending upon the transaction, the impact of poorly performing properties will potentially affect the balance sheet of either occupiers or investors. The proposed legislation applies to lease

renewals and extensions as well as all new leases. Sections of the market previously exempt from all EPC obligations are now

captured, opening up a whole new area of lease negotiation between the landlord and its tenants with regards to improvements. Properties which do not have a lease event in

the short to medium term will also be impacted by a back-stop date of April 2023. Such a property will need to demonstrate compliance irrespective of lease activity. This is intended to force properties under long leasehold arrangements to consider and implement energy efficiency irrespective of a transaction. A number of caveats ensure that