Advice and Opinion

Reopened construction industry slowly overcoming challenges

Construction

The entire construction industry reopened on the 1st of June as South Africa welcomed Level 3. This was largely because of the extensive lobbying of the Construction Covid-19 Rapid Response Task Team which comprised of Master Builders South Africa along with various other industry bodies. However, many companies were caught by surprise at the sudden opening rather than the staggered approach which had initially been planned for in the Risk Adjusted Strategy.  

Although the return to work was universally welcomed, the speed at which it happened meant many companies had to go into overdrive in order to prepare to reopen and to tackle some challenges as a result of lockdown”, said Allen Bodill, Executive Director of Master Builders Association for the Western Cape (MBAWC). “For example, securing the necessary PPE and implementing required safety measures was a challenge considering the financial losses construction businesses had suffered during lockdown.”

Cost

To comply with government’s safety regulations, construction companies needed to source and to provide two cloth masks per employee, bulk hand sanitizer and handheld thermometers, in addition to many other costly measures.

It was also essential for construction companies to have safety plans in place which proved to be another hurdle the industry had to overcome says Bodill: “The legislation around workplace safety was only finally published on 3 June and companies had to scramble to get their plans ready in time. Many had to consult with professional construction industry safety agents to ensure their plans aligned with regulations, which also represented additional costs.

Following this, the Master Builders Association for the Western Cape sent out a template workplace plan to their members and they have been advising them via newsletters to keep them informed of changes in the legislation. “Communication was a priority and our health and safety experts have been available telephonically and on site to assist with this,” he said.

UIF / TERS

UIF / TERS have been a source of frustration for most South African businesses but the good news is that there has been some progress for the construction industry: “The MBAWC has been working with the Western Cape Government’s Red Tape Reduction Unit to try and unlock the issues holding up payments” said Bodill.

We now have a direct line with senior officials at the department and are working on getting each member’s file sorted out and processed,” he explained. “However, it is crucial that the government keep assisting us in resolving this problem. We believe that once the first months’ submission has gone through successfully, the rest will hopefully follow more smoothly and quickly.”

Overtime

An important agreement around overtime was reached between Master Builders Association for the Western Cape, Master Builders Association Boland, and the trade unions at the Building Industry Bargaining Council. “This concession makes provision for additional hours to be worked without incurring overtime rates and was done to allow companies to claw back some revenue” said Bodill.

This means that overtime during weekdays, night shifts or work shifts on Saturdays are worked at standard rates, with Sundays attracting the gazetted double time rate,” he explained. “It is a big concession for the industry, and provides a win-win situation where employers are able to claw back time and cost and workers are able to earn additional income and also recover the daily benefit contributions, that make up their remuneration packages and which were lost during the period of inactivity

Bodill called on authorities to ensure the speedy approval of infrastructure currently in the pipeline.

Force Majeure

The Covid-19 lockdown has been an unforeseen event which has prevented and delayed the due performance of contractual obligations. In legal terms this is referred to as a “Force Majeure” event (or Act of God) and many contracts contain this clause. However, interpreting this for each situation is a legal maze that requires expensive specialist legal advice. 

Bodill concluded: “We are all in the same storm and this situation has really brought people together, even from different industries. People know others are struggling and give help where they can. Although the construction industry has reopened, we are not out of the woods yet.  But, if we work together, we can hopefully get through this and begin to rebuild the industry.”