As the often-quoted advice from Richard Branson goes, “Train people well enough so they can leave, treat them well enough so they don’t want to”. But is this really relevant in the fit-out sector? With an increasing skills gap and an uncertain market where training has always been last on the agenda, who can justify this cost to the bottom line? FIS skills delivery director Helen Yeulet highlights how the FIS Training Needs Analysis 2018 provides some interesting thoughts on this question.
Fit-out is still predominately a subcontracted workforce, although there does appear to be a trend towards direct employment, evidenced by a 5 per cent increase in PAYE. This could be driven by the recent well-publicised decisions regarding Uber workers and the emergence of more zero hours contracts, perhaps, or by a desire to secure skilled workers ahead of the further insecurity threatened by Brexit.
As 94 per cent of respondents to the FIS Training Needs Analysis 2018 (TNA 2018) declared a need for skilled site labour, this can only lead to increased competition for the limited skilled labour available. The biggest question must be whether specialist contractors can afford to keep increasing their rates on each job well after they’ve won the bid, just to keep on track and escape final penalties for delay.
Training and upskilling workers is not seen as an essential part of construction, unless mandated through health and safety, a framework or a Section 106 obligation. The sector still has a heavy reliance on non-UK labour, with over 56 per cent of respondents employing from Eastern Europe and beyond. These numbers are decreasing, but with current UK unemployment levels at 4 per cent (ONS: May to July 2018), the lowest since 1971, where are the future skilled workers coming from unless we attract them into the industry from a young age?
Many of the trends outlined in the most recent Training Needs Analysis of FIS members should be a strong driver towards this thought process, with the TNA 2018 revealing that 40.5 per cent of the workforce are over 40, only 8 per cent are under the age of 24 and only 3 per cent of workers are apprentices. These figures must ring alarm bells for anyone looking to be confident that they can deliver on-site – and with the profit line they anticipate – moving into that post-Brexit world.
Wider social benefits
Social value is becoming an increasingly enforced requirement for contracts. British Land, one of the largest property development and investment companies in the UK, has made a very clear declaration that all of its sites will have 3 per cent apprentices by 2020. And the company is clearly monitoring those delivering on this to ensure there are no ‘best endeavours’ – this is a real contractual requirement.
Earlier this year, David Lidington, Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster, committed to using more voluntary sector organisations to deliver public services with plans to amend the Social Value Act, so that all major procurements will now have to “explicitly evaluate” benefits. The move is a direct attempt to rebuild trust following the collapse of Carillion.
“We want to see public services delivered with values at their heart, where the wider social benefits matter and are recognised,” Mr Lidington said. “That means government doing more to create and nurture vibrant, healthy, innovative, competitive and diverse marketplaces of suppliers that include and encourage small businesses, mutuals, charities, co-operatives and social enterprises – and therefore harness the finest talent from across the public, private and voluntary sectors.”
So, apprentice employment, retraining and upskilling unemployed people, or providing work placements might actually help business to be won. The FIS skills team can help contractors to secure this position in their business. To find out more, get in touch and let FIS turn a problem around – and prove how this can become a return on investment, not a loss to business.
Complete the latest sector-wide digital Training Needs Analysis for 2019 at www.thefis.org/skills-hub
Measom has been awarded a £1.2 million drylining and ceilings package at the Chimes luxury retirement residential development on Horseferry Road, in the City of Westminster.
The 38-week programme contract started on-site last month and is the first time Measom has worked with ISG. The package includes installing drylining and ceilings in the basement, ground floor and upper floors 1-6.
Chimes will include 39 apartments and is the latest Pegasus Life Developments scheme.
Delegates at the annual FIS Conference, held at Worsley Park Marriott Hotel and Country Club in Manchester this month, experienced a packed agenda including keynote speeches, panel discussions and workshop sessions around the important theme Growing Your Business in a Changing Market.
The next 12 months are going to be challenging as the fallout from Grenfell Tower tragedy, the collapse of Carillion and Brexit continue to impact on the finishes and interiors sector. The FIS Conference provided an ideal platform for FIS members to exchange views and experiences and debate how these factors are driving change within the sector and how they might impact their businesses.
FIS president Andrew Smith welcomed delegates and explained how FIS is committed to raising standards across a range of issues affecting safety, performance and skills development. FIS has been particularly successful with boosting awareness and understanding about careers in the finishes and interiors sector and it is driving a campaign to increase skills competence and attract new entrants in the sector.
Iain McIlwee, FIS chief executive, then set the scene for an informative and engaging Conference programme.
A key part of this programme were six interactive workshop sessions providing delegates with best practice guidance and advice to support their businesses in a challenging and changing market. These breakout sessions covered Technical, Skills and Community themes, with delegates attending two from the six available.
Technology in Construction Workshop 1
Paper to Data: How to maximise technology to deliver more profitable projects
Speakers: Barry Chapman and Sarah Crawford, Chalkstring; Richard Hulbert, Trappco; and Joe Cilia, FIS technical director
FIS members learnt more about how technology can support both successful project delivery and business management. The workshop simplified jargon while exploring how digital working can improve efficiency and compliance, reduce waste and increase profitability, with a focus on helping delegates establish how technology could work better for them. It also explored the biggest pitfalls subcontractors can experience when going digital, detailing what to avoid when considering new software solutions and implementing new processes, and which software is right for which type of business, incorporating a high-level review of solutions available to subcontractors.
Technology in Construction Workshop 2
Product, Process, People (PPP): A focus on competency and compliance
Speakers: Paul Nagle, Donseed; Michael Saunders, Re-flow; and Joe Cilia, FIS technical director
The strategic Product, Process, People (PPP) initiative has been developed by FIS over the last 12 months to address Dame Judith Hackitt’s comments regarding a lack of evidence of what is being built, a lack of compliance and a lack of competency of construction sector operatives. FIS members were shown how this process could be integrated into existing management software to help the fit-out sector take control of its asset management, process controls and compliance. The session also included an understanding of how to use software to record operatives’ training and qualifications against individual projects while managing the workforce.
FIS Skills Workshop 1
How to maximise your CITB and Apprenticeship Levy
Speakers: Michael Lennox, CITB; Helen Yeulet, FIS skills delivery director; and Amanda Scott, FIS sector skills engagement manager
Delegates were briefed about the new CITB Grants Scheme and the Apprenticeship Levy. Following a change of rules in April 2018, this workshop helped FIS members to navigate the new Training Directory and the new ways that claims are now made. The workshop also identified how FIS members could maximise their Apprenticeship Levy and make it work for their business.
FIS Skills Workshop 2
How to get your return on investment on apprenticeships
Speakers: Jill Nicholls, Institute for Apprenticeships, and Helen Yeulet, FIS skills delivery director
The FIS Skills team explored the benefits for FIS members of taking on apprentices, in terms of both the positive impact on their business and the opportunity to future-proof their workforce. Delegates were also provided with an overview of the help and support available to them as employers to enable them to get the most out of taking on apprentices. This included information on funding, training and qualification grants available from the CITB and the Apprenticeship Levy to help with supporting and qualifying apprentices.
FIS Community Workshop 1
Ways to increase your profit in just one hour
Speakers: Maria Coulter, Construction Coach, and Iain McIlwee, FIS chief executive
This workshop focused on improving business performance. The interactive session encouraged delegates to set clear objectives: whether they wanted to grow or stay the same size; whether they wanted a better lifestyle for them and their families; and whether they have business areas that are wasting time and money but they aren’t sure how to tackle. This session helped to provide clarity and an action plan for businesses on how to move forward, improve profits and work towards having the lifestyle and balance they wanted.
FIS Community Workshop 2
Strategies to drive demand and increase sales
Speakers: Dave Rainbow, Results Agency, and Iain McIlwee, FIS chief executive.
During this workshop, delegates explored the topics of developing new business, lead creation, conversion and demand generation, focusing on the foundations of what businesses should consider before embarking on any marketing/sales activity and making sure objectives are aligned to any activity being undertaken. One key area of this workshop was helping delegates to select the correct tools with which to execute their strategy, with real examples given along with key tactics for them to employ in their organisations.
FIS chief executive Iain McIlwee concluded the Conference with a specially designed Room 101 Debate looking at the future of the finishes and interiors sector.
Find out more about FIS events here: www.thefis.org/events
Under the JCT suite of contracts, a Relevant Matter is a matter for which the employer is responsible that materially affects the progress of the works and may entitle the contractor to make a financial claim for the direct loss and/or expense that it has incurred. Kara Price, a solicitor within Womble Bond Dickinson’s specialist construction team, gives some pointers.
A contractor can often claim loss and/or expense at the same time as an extension of time. The Hot Topics article in September on ‘Relevant Events’ dealt with extensions of time.
For the contractor to prove the direct loss and/or expense it has suffered, it must show:
- That it is entitled to claim additional costs under the terms of the contract; and
- That the employer has breached the contract.
Relevant Matters may include:
- Failure to give the contractor possession of the site;
- Failure to give the contractor access to and from the site;
- Delays in receiving instructions;
- Failure by the employer to supply goods and/or materials; and
- Disruption caused by work carried out by the employer.
Prudent employers will often amend or delete Relevant Matter provisions to limit the contractor’s entitlement to claim direct loss and/or expense, for example by:
- Deleting the entitlement to any loss and/or expense for the discovery of any antiquities; or
- Amending the contract to ensure no entitlement for loss and/or expense for the contractor’s own error, omission, negligence, breach or default on behalf of the contractor or any contractor’s persons.
Ordinarily, a subcontract will mirror the terms of the main building contract or contain a deemed awareness provision so that any employer amendments or deletions will be passed down the supply chain.
Important tips
- Review the contract – have any amendments been made which could limit your ability to claim for direct loss and/or expense?
- Review the contract mechanisms in respect of notification of a Relevant Matter.
- Ensure you have a good record-keeping system – if a claim is made, an assessment of the loss and/or expense already incurred and any further amounts likely to be incurred will be required.
FIS members requiring assistance with this topic can contact Philippa Jones through the FIS Legal Helpline.
FIND OUT MORE
kara.price@wbd-uk.com
0191 230 8860
Office partitions specialist VISO Partitions has developed a new range of industrial-look glazed partitioning systems and matching integral doors, meeting the growing trend in interior fit-out for stylish vintage finishes.
VISO has emphasised the industrial look with a graphite colour for the aluminium track and framing.
The new system, which is available as part of a full package of VISO supply and installation options for glazed partitions and doors, offers single-glazed options for toughened and laminate glass (10–12.8mm) with an acoustic performance range of 35-39db Rw.
www.visopartitions.co.uk
Insulation and interior building products distributor CCF recently held an industry lunch and learn event to highlight the importance of fire protection and third-party accredited products and installers.
The event, in conjunction with the Association for Specialist Fire Protection (AFSP), Promat, Rockwool and Tradeline, was the second of its kind to take place. Building professionals benefited from one-on-one time with leading fire protection suppliers, technical guidance and product showcases.
Part of the session reflected on content covered in the Dame Judith Hackitt review, in particular the potential introduction of a “more rigorous and transparent product testing regime”, along with how the review will likely impact the products and materials specified, installed and maintained.
Paul Grundy, CCF’s technical director, said: “We are proud to have held a second event inviting building professionals to consider how third-party accredited products and installations can benefit them and their customers.
“As a responsible supplier, committed to offering quality products, great service and trusted advice, it is important for us to be talking about fire protection and the different compliant and added-value options, such as third-party accreditation.”
Ron Payne, managing director of Complete Wall Solutions, who attended the event, commented: “It is important for my business to stay informed, so I was more than happy to attend CCF’s lunch and learn event.
“It was a good opportunity to hear more about third-party accredited products and systems, and the added reassurance it can give when used in the specification and installation process.”
www.ccfltd.co.uk/spotlight/fire-protection
The construction industry experienced modest growth in the third quarter of 2018, following a weather-related boost to activity in Q2, according to a quarterly survey of product manufacturers, contractors, civil engineers and SME builders by the Construction Products Association (CPA). However, rising materials and labour costs, economic uncertainty and a narrowing forward workload is causing concern
The CPA’s Construction Trade Survey for 2018 Q3 shows that during the quarter, 27% of product manufacturers, 25% of main contractors, 16% of SME builders and 10% of civil engineering firms reported an increase in activity. Output was reported lower for one-third of specialist contractors, however.
The new orders and enquiries logged in Q3 indicate that the drivers of growth in the next 12 months will be restricted to private housing, repair and maintenance, and infrastructure, whilst further rises in costs have been reducing profit margins for main contractors and specialist contractors since the beginning of 2017. On balance, 80% of main contractors reported a rise in materials and labour costs, 90% of product manufacturers reported an increase in fuel costs and cost rises for civil engineering contractors reached a three-year high.
Rebecca Larkin, senior economist at the CPA, said: “The industry looks to have maintained some of the momentum from its catch-up in the second quarter. However, beneath the top-level growth rate, firms throughout the supply chain are grappling with a narrowing base of activity led by private housing and infrastructure work and rising costs for labour, raw materials and fuel. This triple threat for input costs is placing a clear strain on contractors’ profit margins, worsening confidence in an already-heightened environment of risk aversion.”
Richard Beresford, chief executive of the National Federation of Builders (NFB), said: “The latest trade survey indicates a general increase in construction output, workloads and enquiries for SME contractors throughout the third quarter of 2018. This trend reflects the effect of the unseasonably warm weather in lifting up overall industry performance. The fall in profit margin for 7% of main contractors and 33% of specialist contractors is rather worrying because it is less than one year since the collapse of Carillion. With the economy facing further uncertainty in future months with the UK’s departure from the EU in March 2019, contractors operating with falling profit margins are a reason for concern.”
Key survey findings include:
- On balance, 25% of main building contractors reported that construction output rose in the third quarter of 2018 compared with a year ago
- On balance, 16% of SME contractors reported increased workloads in Q3 compared to three months earlier
- Main contractors reported that order books were higher in private new housing, and the housing and non-housing R&M sectors
- During Q3 new orders fell for 17% of specialist contractors
- 22% of SMEs reported an increase in enquiries in Q3, on balance
- Overall costs increased for 89% of civil engineering contractors, whilst 80% of main contractors reported a rise in costs for labour and materials. Fuel costs rose for 90% of heavy side and light side product manufacturers
- Profit margins fell for 7% of main contractors and one-third of specialist contractors in Q3.
In August, the CBI set out its proposed approach to immigration after Brexit in a report entitled Open and Controlled – A New Approach to Immigration after Brexit. Simon Lewis, a partner in the Construction and Engineering team at Womble Bond Dickinson, provides a useful summary of the main findings.
The report published by the CBI (www.cbi.org.uk/insight-and-analysis/open-and-controlled) notes that immigration has delivered significant economic benefit to the UK over the last 50 years but has also given rise to public concern about the pressure it creates on public services and society. Consequently, post-Brexit free movement of people will not continue on the same terms as it has been in the past.
The UK immigration system must, however, remain sufficiently open to support the UK economy but with enough control to rebuild public trust and confidence. As the report states bluntly, the stakes are very high: if the reformed system does not work, the UK risks having too few people to run the health service, pick food crops, deliver products to stores around the country and, in the case of construction, build the houses and the infrastructure that we need.
The main findings of the Open and Controlled – A New Approach to Immigration after Brexit report are as follows:
- Immigration is valuable to all sectors of the UK economy and delivers a significant economic benefit.
- Most business sectors require a combination of skill levels and are inter-linked through supply chains, so a whole economy approach is required.
- Mobility is as important as migration, particularly for the UK economy where services play a vital role. This is about easy movement of staff across Europe, often at short notice, which is an integral part of many firms’ business models.
- The current non-EU immigration system is inaccessible for most firms and is not the solution for EU nationals. The current constraints on the non-EU immigration system are harming the UK economy so simply applying this or a similar system to EU citizens would not work.
- Businesses recognise that free movement is coming to an end and want to restore public trust in immigration.
Consequently, the CBI’s recommendations seek to address these issues. They suggest the following:
- Build public trust in the UK immigration system by shifting away from controlling numbers to assessing contribution and by investing in local public services where demand has been increased by migration.
- Reform the UK’s non-EU immigration system so that firms can better access people and skills from around the world, not just the EU.
- Recognise the strong links between people and trade as the UK forges new economic relationships. This will involve negotiating the simplest possible travel arrangements for all British and European citizens to avoid lengthy border delays at sea and airports after Brexit.
- Replace free movement with a new open and controlled immigration system for EU citizens.
- Ensure that the transition to any new migration system is done with respect for people and in an orderly manner. It will be necessary to legally guarantee the rights of EU citizens already in the UK even in the event of a ‘no-deal’ scenario which, at the time of writing, appears to be increasingly likely.
The construction impact
From the point of view of construction, the migration issue is very significant. Half of London’s construction workforce are not from the UK. Without international labour, the UK cannot build enough new homes and deliver on critical infrastructure projects. This becomes very clear when the goals set out in the National Infrastructure Assessment of July 2018 are considered. This report sets out ambitious infrastructure development programmes vital to the UK’s continuing development and position in the world economy, but very little of this will come to pass if we do not have the skills and labour available.
It is simply not possible for the UK to function without some form of open but controlled immigration system. There is no doubt that however the UK develops after Brexit, it will have to rely upon EU and non-EU workers and freedom of movement across borders in order to continue to function at anything like the level that it has been in the past. Quite how we get there, however, seems at the moment to be as unclear as ever.
Mesh ceiling panels from SAS International provide specifiers with a contemporary and versatile ceiling solution that’s in keeping with the current desire for a modern industrial style.
Compatible with multiple SAS International systems, the mesh ceiling range consists of designs including Celtic, Tene, Brig, Tara, Kells and Vix – each offering diamond or hexagonal patterns in varying sizes as standard and all available in the full range of RAL colours. Bespoke designs can be created, enabling the designs to be tailored to complex building layouts.
Mesh is ideal for smoke extraction due to its high open area and can be integrated with M&E services such as sprinklers and lighting.
SAS International mesh panels are compatible with SAS130, SAS200, SAS205, SAS320, SAS330 and SAS600 raft ceiling systems.
www.sasintgroup.com
Photo credit: Philip Vile
MEDITE products have been used to create a wildlife garden at a Derbyshire school designed by not-for-profit social enterprise Green Future Building, which helps young people gain employment in the sustainable construction industry.
The Margaret Baxter Wildlife Garden at the Lakeside School was created as part of an education and design programme to encourage children’s learning of the natural world. Alongside a wildflower meadow and wetland habitat, a bespoke bird hide and hedgehog-friendly fencing with tailormade wildlife cut-outs were built – both extensively feature MEDITE TRICOYA EXTREME (MTX) and MEDITE PREMIER FR MDF.
The 7m x 4m hide used 30 sheets of MTX and can allow an entire class of children to observe the wildlife. MTX is acetylated MDF, guaranteed to last up to 25 years where in contact with soil, such as where it meets the ground, and up to 50 years elsewhere, in all outdoor weathers.
Twenty-eight sheets of MEDITE PREMIER FR were also used – a flame-retardant MDF panel offering fire protection – to line the inside of the walls.
www.mdfosb.com
Prev
