When operating in the building industry within the scope of the relevant collective agreement, it is compulsory for employers and employees in the building industry and who falls within said scope as described in the main Collective Agreement, to register with The Building Industry Bargaining Council – Cape of Good Hope (BIBC). When registered, benefits must be paid calculated daily and considering the job category of the employee. A costly venture, but in the best interest of the employees as they are assured a minimum wage and the contributions are towards a sick pay fund, holiday & bonus fund, provident fund, etc.
Those employers (SME’s) in the building industry who are willing to comply are already burdened with a very competitive market and huge daily expenses. Unfortunately they are at the short end of the stick when quoting on building projects. They are “competing” with non-complying, non-registered informal builders, better known in the industry as “Bakkie Builders”, who can under quote registered contractors when approached by potential clients. It is possible to drop prices drastically when there are no registration fees, council levies and contributions towards benefits payable.
From my experience, their employees have no protection against underpayment, other than that offered in terms of the new Minimum Wages Act. They are denied even their basic rights in terms of the Unemployment Insurance Fund and the protection offered in terms of the rules and regulations of the Occupational Health and Safety Act.
The only real “gain” for the complying contractor is credibility; he/she offers the “peace of mind” that the potential client associates with hiring a registered and credible company, one who need to adhere to strict rules and regulations. Nonetheless, are clients willing to pay more to do the right thing?
Recently, whilst consulting with a client, the elderly contractor (Plumber) and his daughter became emotional when they told me about their dilemma being underquoted on jobs by “Bakkie Builders”, who are always willing to do it for cheaper. This small family business was struggling to do the right thing, but had to experience, on a daily basis, how their business suffered due to this reality. How another’s disregard for compliance are “rewarded” with getting the deal. Non-compliance will lead to enormous fines, which if not paid, could lead to having the Sheriff of the Court on your doorstep. Talk about being between a rock and a hard place.
The BIBC monitors and enforces compliance by means of employing field inspectors who physically visits building sites, authorised to issue compliance orders. On their website it is possible to simply do an online search to determine whether a potential contractor is compliant or not.
It is also legally compulsory to belong to the National Home Builders Registration Council (NHBRC). Membership to the above authorities are required in terms of SA legislation – this is done to protect employees and clients.
We ask you, the property owner and potential client, who is considering building that second garage or third bedroom, to do the right thing. Understand why credibility cost money. You know what you can expect, when you pay peanuts.
Employers, if you are not sure whether your day to day operations are within the scope of a relevant authority, contact experts to assist you and/or to formally apply for exemption, should you qualify. At The Labour Law Company, we can help you to do the right thing! Contact us today at info@thelabourlawcompany.co.za or call us on 021-975 1885 for a free consultation.
Author: William van der Westhuizen (BProc.)
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