Construction union UCATT are calling for urgent action to tackle false self-employment in the construction industry after new figures from the Office of National Statistics revealed a major increase in self-employment.

The ONS found that since 2008 the number of self-employed workers across all industries has increased by 367,000. The occupations with the highest number of self-employed workers were taxi/cab drivers and chauffeurs, other construction trades, carpenters/joiners and farmers.

According to the ONS figures the number of self-employed workers in the construction industry comprises 44% of all workers.

Steve Murphy, General Secretary of UCATT, said: "The rise in self-employed construction workers is due to companies cutting costs by pretending workers are self-employed. False self-employment denies workers basic rights, denies the Treasury income, increases safety problems and threatens the long-term health of the construction industry."

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Companies using falsely self-employed workers avoid paying Employers National Insurance contributions of 13.8% per worker. The loss to the Treasury due to false self-employment in construction is estimated to be just under £2 billion per annum.

False self-employed workers are denied basic employment rights. They don’t receive holiday or sick pay, don’t receive pension payments and can be sacked at a moment’s notice. Self-employed workers are at greater risk of workplace injury and companies which use falsely self-employed workers are unlikely to train apprentices.

False-self-employment in construction is fuelled by the Construction Industry Scheme (CIS) a unique stand-alone tax system. Unlike other forms of self-employment, workers are taxed at source but are entitled to make a self-assessment return.

In UCATT’s recent report into payroll companies The Great Payroll Scandal it was revealed that the number of workers operating under CIS over the last 3 years had increased by 30,000 from 740,000 to 770,000 at a time when the number of construction workers was falling due to the recession.

(CD/GK)