Increased protection for overseas construction workers

Construction workers who are sent (‘posted’) to the UK from another EU Member State now have new rights under regulations that came into force on 18 June 2016.

The Posted Workers (Enforcement of Employment Rights) Regulations 2016 and the equivalent Northern Ireland regulations make UK organisations that contract with overseas EU-based contractors to carry out work within the construction sector in the UK responsible for ensuring that their contractors comply with UK minimum wage requirements for workers they post to the UK.

UK organisations who contract with overseas EU-based contractors will therefore need to carry out some form of ‘due diligence’ on prospective contractors. Although the government has said it will publish due diligence guidance, there is currently no prescribed format for this, and the government has stressed that ‘due diligence’ will mean different things in different situations.

The regulations have been introduced to implement a European Directive and their aim is to protect construction workers who normally work in an EU Member State outside the UK, but are temporarily posted by their employer to carry out work for an organisation in the UK. In particular, the regulations give these workers the right to be paid at least the applicable UK national minimum wage.

Most significantly, if their employer underpays them, these workers can now bring an employment tribunal claim against the company who contracted their employer to carry out the work. This effectively makes organisations responsible for ensuring that their contractors pay their workers at least the UK minimum rates of pay. Due diligence is vital in this regard, as it is a defence under the regulations for an organisation to show “…that it exercised all due diligence to ensure that the worker’s employer would remunerate the worker in respect of the relevant sum [the applicable UK national minimum wage] due to the worker.”

David Hewitt, Head of Employment Law Information, says:

“Until the government produces its guidance as to what will constitute ‘due diligence’ it is recommended that organisations in the construction sector should seek details of the proposed remuneration for any posted workers who will be engaged on the contract. Organisations could also include a warranty in the contract confirming that the contractor will comply with minimum wage requirements, or seek an indemnity from the contractor in respect of any potential employment tribunal liability.”

Still unsure? If you are a client, please speak to our Employment Law advice line on 0345 844 4848 for any further questions or to discuss alternative commercial options.

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