Hiring registered businesses is more than just cost-and-time savings, it’s for the greater good of the country.
Freepik.com
South Africa has a shocking unemployment rate, and the building industry role players recommend that businesses and members of the public tread carefully when securing the services of unregistered building and plumbing contractors.
Being a registered entity comes with an obligation to meet quality standards, construction regulations and customer expectations. This promotes higher standards of workmanship, safety and project delivery.
Findings by the Building Industry Bargaining Council (BIBC) show that businesses not registered with the organisation lack the basic infrastructure to deliver on quality outcomes. What’s more, deadlines and budget targets are often missed by them.
The BIBC’s council spokesperson for business, Danie Hattingh, says the council has seen many examples of work having to be redone to address these quality concerns.
“The direct result of this is that the contractor responsible has narrower profit margins or has eroded margins due to the penalties imposed by the ‘giver of work’. The delays that result from having to redo work have financial implications for all parties caught up in this unfortunate scenario,” he says.
Unregistered employment accounts for 38% of all jobs in South Africa’s construction sector. The building industry forms a big part of this, along with plumbing, and these workers are not usually under the protection of labour laws that cover minimum wage, overtime pay and safety regulations at the workplace. Unregistered employers also take advantage of workers in order to undercut their competitors.
These unregistered labourers may not necessarily get negotiated minimum benefits applicable in the industry and receive whatever the non-compliant employer decides. There is also a lack of stability in these situations, which impacts the workers’ possible future income and job prospects.
The BIBC’s council spokesperson for labour, Luyanda Mgqamqo, says that these labourers often have to endure irregular work hours, fluctuating income and a heavy dependence on temporary employment.
“Of particular concern to the BIBC is that these employees and their dependents are also not protected in the event of death and disability,” he says.
On the other side of the coin, employees registered with compliant employers receive daily contributions towards their annual leave, sick leave, retirement fund and bonus.
Hattingh notes that not addressing the gaps between registered and unregistered parties can have a detrimental impact to both the industry and economy.
Unregistered labour raises the possibility of unfair competition by skirting regulations and standards. This then impacts government tax collection, infrastructure development and efforts to promote sustainable housing solutions.
“Where both the ‘giver of work’ and the contractor have a culture of non-compliance, the impact on sustainable and decent employment is even more pronounced,” he adds.
On the plus side, though, collective bargaining, as an example, ensures that employers in the industry compete on unique selling points like excellent work and quick turnaround times – all of which come from both skilled and stable teams.
The BIBC has been a driving force in the transition from unregistered to registered employment by establishing standards, negotiating agreements, managing compliance, offering support services and promoting dialogue and collaboration among stakeholders.
“Businesses have a critical role to play in promoting registered employment by ensuring that only employers who adhere to legal requirements are contracted to do work in the building industry,” says Hattingh. “’Givers of work’ can visit the BIBC website to see whether the contractor is registered with the BIBC and is compliant. Our experience is that when employers are compliant with the BIBC there is a higher likelihood that they are compliant in other areas, such as adherence to health and safety and unemployment insurance regulations.”
Source: Building Industry Bargaining Council (BIBC)
