The Enquirer understands that electricians downed tools yesterday at NG Bailey’s Tottenham Court Road tube station rebuilding site.
The sparks are demanding they are taken on directly on full pay rates agreed under the JIB national agreement.
It is the highest-profile dispute to flare-up following the introduction of new laws to stamp-out false self-employment.
One source said: “The sparks want a full rate and they don’t want to be coerced into using payroll companies any more.
“This will spread like wildfire across sites and the main contractors and clients will have to go with it despite the 25% jump in labour costs.”
NG Bailey said: “NG Bailey can confirm that it is not in dispute with any agency or agency worker.
“The dispute is between the agencies and the agency workers as a result of the hastily introduced change in tax laws in the Chancellor’s 2014 Budget.
“This is an industry wide issue and it will take some time to transition the change, during which we will work closely with Unite the Union, agency providers and the workers themselves.
“NG Bailey welcomes the change and deeply believes in direct employment as it creates stability of the workforce, leading to improved safety, greater investment in on-going training and apprenticeships and, a more sustainable industry.
“However, there must be a recognition that the construction industry does require a degree of flexibility in labour resourcing, but that should not mean lower standards.
“Workers provided by reputable and professional agencies should expect to be treated fairly and on a par with their directly employed colleagues.”
Sparks working at Three Bridges Station in Crawley have also been taken on directly after refusing to work through a payroll firm operating as an umbrella company.
One site source said: “When the 35 agency electricians heard how their pay would fall via an umbrella arrangement they all demanded to be taken on direct at full JIB rates.”
A luxury residential job at the fit-out stage in west London has also seen the Unite union lead negotiations for the transfer of M&E workers to direct employment.
A Unite circular currently going round sites states: “Attempts to force workers into accepting payroll company status against your will should be strongly resisted.”
Electricians are in a stronger position because the JIB agreement is based on realistic hourly rates.
The Working Rule Agreement for general building workers contains much lower rates designed as a starting point for pay negotiations.
One source said: “Electrical contractors can’t go below the JIB rates if they take the lads back on the books.
“It’s a different story with the building agreement where the minimums are so low.”
The false self employment crackdown could see more than 200,000 construction workers move back onto PAYE.
A union source said: “The industry is only just waking up to the huge implications of this.
“Payroll companies have spread like wildfire to become the norm on most sites.
“That’s just not going to happen anymore so you are seeing a 25% jump in labour rates on jobs that have already started then all the rows over who will pay for all this in future.”
