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Unions confront ‘tax scam’ firms

Crooked ‘umbrella’ companies deduct fees from construction workers’ pay

Construction unions confronted building firms across Britain yesterday over a rampant tax scam that costs the public purse and workers millions a year.

Outside Parliament MPs and leaders of three trade unions rallied against the rise of crooked “umbrella” companies which exploit a legal loophole to evade employer dues.

Earlier, construction union Ucatt members had picketed the gates of sites where the exploitation is taking place.

Its general secretary Steve Murphy told the Star that workers were being confronted with “wage slips so complicated they don’t know what they’re getting.”

In some cases people being hired on £12 an hour had their theoretical wage printed on one sheet and the minimum-wage reality on another after “fees” had been deducted by bosses to cover employers’ national insurance costs.

Ucatt estimates that thousands a year are skimmed from each person hit, which also means a reduced take for the government as tax-free “expenses” are used to top up wage packets.

“These people are having their wages stolen from them by charlatans,” said Mr Murphy.

“They’re in this to make a quick buck — to make as much money as quickly as possible off the back of construction workers and the construction industry.”

Labour MP Ian Lavery branded it just one part of a “package of measures targeting working people.”

“There can be no compromise — this needs to be stamped out,” he said.

Britain’s biggest union Unite and the Rail, Maritime and Transport (RMT) union joined the Westminster lobby.

RMT general secretary Mick Cash warned that thousands of workers paid with public cash via state-owned infrastructure firm Network Rail were also being caught in the scam.

Up to 70,000 contractors in safety-critical jobs were being targeted by umbrella firms, he said.

The campaign had “lifted the stone” on the abuse, he explained, “but it’s a damning indictment that we have such exploitative practices being so widely used.”

Two weeks ago Treasury Secretary Danny Alexander told MPs he was unaware of the scam.

But TUC general secretary Frances O’Grady accused ministers of “turning a deaf ear.”

“If they want to understand they only need visit any construction site, talk to the workers and hear for themselves,” she said.

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