Lawyer explains the difficulties for building contractors getting paid

Lawyer explains the difficulties for building contractors getting paid

8 June 2016

CRIPPLING payment problems faced by local subcontractors is the untold backstory of many super-commuting tradesmen.

Subcontractors sickened by the need to fight for final payments before feeling pressured into reduced settlements has forced hundreds of local businesses out of work since the recession hit.

With payment difficulties less likely during a boom, many workers are deciding that a gruelling journey to work away from their families is an acceptable price to pay for better financial security.

International lawyer and arbitrator Mark Kane, a specialist in construction dispute resolution, has guided hundreds of construction workers across Ireland through pay disputes.

Mr Kane said it was the very unusual nature of the construction industry that workers agree to start a job without knowing what they will get paid in the end — at which time significant sums have already been invested in ma.terials and labour.

He said subcontractors were particularly vulnerable during straitened economic times with many long established family businesses folding in recent years due to the very specific nature of the construction market.

Mr Kane said this was undoubtedly fuelling the new trend of supercommuting.

 “It is the only industry I know of where you do all the work and spend all the money and you do not know what you are going to get paid back,” he said.

“The nature of construction contracts is that the final figure is very much up in the air and that is where problems arise.”

Mr Kane said the industry was designed in such a way that those “lower down the food chain will always get a worse or harder deal.”

“As the main contractors comes under pressure from their clients, that pressure and cost is passed down to subcontractors. There will always be negotiations at the end of a job; that is the harsh reality of the construction industry.”

Mr Kane said payment difficulties were accepted across Ireland as “the way it is”, but the impact was wide-reaching.

“People will read this story today and think ‘oh yes that happened to my uncle’, or someone else they know. So many people are affected,” he said.

“It has put many established family businesses out of work. If a builder wants to get rid of a subcontractor — to cash him in — there will alway be somebody else available and willing to take on the job.

“When contractors have new jobs ahead they have an interest in paying their subcontractors to get their work done and that is likely during a boom. It is when the work starts to dry up that it may seem like time to cut the guy off. 

“That is the harsh reality of the system. It is the nature of the beast of the construction system.”