Many construction workers left without pension scheme

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A freedom of information (FOI) request made by Unite, has revealed that the government’s pension policy is failing construction workers, with fewer than one in four regularly paying into a workplace pension

The figures obtained from the Department of Work and Pensions (DWP) show that just 23% of blue collar construction workers are participating in a workplace pension.

The Office of National Statistics estimates that 1.5 million workers are employed in blue collar construction work (skilled trade occupations, elementary occupations a process, plant and machine operatives). The DWPs figures show that only 349,000 blue collar construction workers are paying into a pension.

The lack of blue collar construction workers paying into a pension can be seen as a major failure of the government’s auto-enrolment pension scheme, which was designed to ensure all employees pay into a workplace pension.

The revelation that the majority of blue collar construction workers don’t pay into a pension may result in them facing poverty in retirement.

Factors that result in construction workers not having a pension include:

  • Roughly half of blue-collar construction workers are officially registered as self-employed and therefore not eligible for the auto-enrolment scheme
  • The extensive use of umbrella companies where workers are required to contribute both employers’ and employees’ pension contributions making them unaffordable for many
  • Short term engagements which result in workers believing it is not worth making pension contributions
  • Construction employers’ hostility to paying pension contributions.

Unite assistant general secretary, Gail Cartmail, said: “These figures show that the government’s auto-enrolment pension policies are failing construction workers.

“Rather than tackle the factors which make it difficult or impossible for construction workers to contribute to the auto-enrolment pension regime, the government has acted like an ostrich and chosen to ignore the problem.

“Until rampant casualisation and bogus self-employment are tackled in the construction industry, workers are not going to be eligible or prepared to register for a workplace pension.”

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