A Freedom of Information request made by Unite to HMRC revealed that 1.12 million construction workers were paid via the Construction Industry Scheme (CIS) in 2017/18 – a 4% increase on the previous year.
Unite claims “the vast majority are bogusly self-employed”.
It said: “In 2014 the government introduced measures designed to crack down on bogus self-employment in the construction industry, by barring construction workers operating via engagers (employment agencies and payroll companies) from being self-employed
“The continuing year on year increase in the number of workers operating via the CIS scheme demonstrates that the government’s crack down on bogus self-employment has failed.
“Since 2014 there has been an 18% increase in workers operating via CIS.”
In total 49% of the industry’s 2.29 million workers were paid via CIS in 2017/18.
Unite assistant general secretary Gail Cartmail said: “These latest figures are a damming indictment of the failure of the government to deal with rampant bogus self-employment in construction.
“Bogus self-employment is costing the exchequer millions in lost revenues and amounts to a huge hidden subsidy to construction employers.
“The government has clearly lost control of tackling bogus self-employment in construction, resulting in the routine exploitation of workers.
“The entire system needs to be radically reformed so that workers are either genuinely self-employed or paid via a standard PAYE format.”