Almost half a million 'falsely self-employed' in construction jobs - 16-05-2008 - 11:02

As many as 425,000 people in construction jobs are falsely self-employed, according to research.

Employers are making no national insurance (NI) contributions and workers are paying lower NI and claiming special tax rebates, a report by the University of Essex has indicated.

It is stated that tax evasion through false self-employment is costing the UK £1.7 billion per year, far in excess of government figures suggesting a fiscal loss of £340,000.

Professor Mark Harvey, the author of the report, said false self-employment is being adopted to reduce tax liability and employer responsibility.

He continued: "The UK construction industry has been characterised by high levels of false self-employment for several decades but recently this level has risen significantly."

The Trade Unions Congress (TUC) recently claimed the Construction Industry Scheme, the industry's self-employer tax scheme, needs to be reformed.

A TUC commission urged that changes occur to protect people in construction jobs from suffering a lack of statutory rights and missing out on workplace benefits.

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