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Workers need more protection from poverty in retirement

The revelation that just 36% of workers in the construction industry are saving into a pension scheme means thousands face poverty in old age.

Unite the union was able to access Department of Work and Pensions figures through a freedom of information request which showed that only 797,000 employees out of a total industry workforce of 2.2 million were paying into any kind of pension. These figures do not include the tens of thousands of self-employed workers used by construction firms, whose pension participation is believed to be even lower.

Unite national officer for construction Jerry Swain said this would result in a “destitute generation of future pensioners”.

However, the Building Engineering Services Association (BESA) said many should already have pension rights locked into their working conditions and urged employers to take advantage of a working agreement that has had contractual pension provisions at the heart of its wider benefits package for more than a decade.

The Association, which represents building services employers, explained that the National Wage Agreement enshrines the right of all operatives, including apprentices, to participate in an employers’ contributory pension scheme. As part of a worker’s terms and conditions, employers contribute a minimum of 5% of basic earnings into a qualifying scheme. 

Forward thinking

The Agreement is negotiated between BESA, on behalf of employers, and Unite, representing the workforce and both parties were congratulated for their “forward thinking approach” when the pension element was added in 2010.

It was set up as part of the terms of negotiated wage settlements before ‘auto-enrolment’ legislation made contributory pensions a legal requirement for employers.

“The National Agreement has always been, and remains, ahead of the curve as far as pensions are concerned,” said BESA’s head of employment affairs Paula Samuels.  “Through these contractual pension arrangements, employers continue to demonstrate a long-term commitment to making sure operatives are catered for beyond the lifetime of the employment relationship.”

This could also help to overcome the major difficulty for many workers trying to plan for the future caused by construction’s widespread use of short-term contracts and umbrella companies that create insecurity and confuse employment status.

BESA added that providing a benefits package was an important part of a wider investment by employers in creating a high-quality workforce where skilled operatives were properly rewarded for their loyalty and commitment to professional working practices.

“Employers who take advantage of the full range of in-service benefits via the BESA subsidiary Welplan, such as sick pay, death benefit, and disability benefit, show they value their workers and want to provide for them and their families should the worst happen.

“This also gives the employer a competitive advantage because they can offer better terms to skilled workers, who are in higher demand than ever as the industry bounces back from the pandemic,” added Samuels. “

www.welplan.co.uk

10 May 2021

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