Innovative approach in preventing fraudulent practices in the construction sector

Instytut Spraw Publicznych

Podziel się
Social policy

Innovative approach in preventing fraudulent practices in the construction sector

The three research centres: FORBA (Austria), NOTUS (Spain) and Institute of Public Affairs (Poland) conducted a research study on strategic and innovative practices of social partners and labour inspectorates to improve the efficiency of enforcing labour standards in the construction sector. 

Findings from Spain, Poland and Austria display bogus self-employment, underpayment, breach of OSH regulations as comparably widespread fraudulent practices in construction. To effectively detect and pursue such non-compliant behaviour, social partner (institutions) in cooperation with public authorities such as labour inspectorates developed joint activities, prepared legislative acts and intensified institutional cooperation. 

In Poland, a country with rather weak social partner tradition, three relevant co-enforcement agreements were enacted in the construction sector, namely the Agreement for Safety in Construction (ASC), the Agreement on Minimum Wages in Construction (AMW), and the Agreement for Occupational Safety at the Operation of Cranes (AOSOC). The three agreements provide an autonomous response to fraudulent practices in the construction sector in an area where neither collective labour relations nor public institutions are able to deliver acceptable standards. The agreements involve both representatives of employers and employees, and the Polish Chief Labour Inspector played a significant role in initiating and /or supporting these agreements.

Read report

In Asturias (Spain), two sectoral social partner institutions, COPREVAS (Comisión de Seguridad y Prevención de Riesgos Laborales y Contratación) and FLC (Fundacion Laboral de la Construcción des Principado de Asturias) play a key role as partners in co-enforcement. Concretely, delegates are endowed with competences to inspect alleged bogus self-employment and compliance with OSH standards on construction sites in Asturias. Was the cooperation with public authorities initially rather informal, social partners strategically engaged with them by institutionalised communication, joint trainings, and privileged information sharing about construction companies and finally concluded a formal cooperation agreement in 2017. 

In Austria, the Construction Workers' Holiday and Severance Payment Fund (BUAK), received 2011 wide reaching responsibilities in implementing a key law to combat fraudulent employment practices, the so called “Anti-Wage and Social Dumping Act”. They include the right to inspect wages at construction sites, verify suspected cases of wage and social dumping and denounce cases to the district authority. BUAK is a long-standing social partner institution with high industry expertise; it was a novelty in Austria that such an institution was endowed with enforcement competences when it comes to issues of underpayment and wage inspection.

The project is co-financed by the European Union funds under the budget line: „Improving Expertise in the field of Industrial Relations“ (VP/2018/004/0080)
Subscribe newsletter