The Building Regulations in England and Wales have been revised to include a Competency General Requirement that relates to all involved in the design and construction of buildings.  Whilst this General Requirement is not explicit in Regulation in Scotland and Northern Ireland, a general expectation has been established.   The Competency General Requirement states:

Any person carrying out any building work as a contractor or any design work as a designer must have:
(a) where the person is an individual, the skills, knowledge, experience and behaviours necessary,
(b) where the person is not an individual, the organisational capability,
to fulfil the duties of a contractor or designer, as the case may be, under these Regulations in relation to the work.

FIS has developed a new toolkit to provide essential guidance and tools to support FIS Members in meeting new regulatory competence requirements. It draws heavily on FIS work with the Regulator through the Industry Competence Committee (ICC).

Access the FIS Competency Toolkit here

What is the Construction Industry Scheme (CIS)?

The Construction Industry Scheme (CIS) is a UK tax scheme operated by HM Revenue & Customs (HMRC).  CIS is designed to make sure tax is collected correctly in the construction industry, where work is often carried out through subcontracting rather than direct employment.

Instead of subcontractors paying all of their tax at the end of the year, CIS collects part of the tax at the point they are paid.

How CIS Works in Practice

It sets out how payments must be handled when one business pays another for construction work.  Under CIS, contractors must:

• Deduct tax from payments made to subcontractors for construction work, and
• Pay those deductions to HMRC on the subcontractor’s behalf.

These deductions are not an additional tax. They count as advance payments towards the subcontractor’s corporation tax or self‑assessment liabilities.

Most construction businesses must register for CIS.  Subcontractors do not have to register, but higher deduction rates apply if they are not registered.

When a contractor pays a subcontractor for construction operations:

• The subcontractor is first verified with HMRC.
• A deduction is applied at the appropriate rate:
  • 0% (gross payment status – where HMRC approval is in place)
  • 20% (registered subcontractor)
  • 30% (unregistered subcontractor)
• The deduction is paid to HMRC and reported via monthly CIS returns.

Only labour costs are subject to CIS deductions. The direct cost of materials can usually be excluded, provided the subcontractor has purchased those materials for their own contract.

What payments CIS applies to

CIS generally applies to labour costs for construction work, such as building, repair, alteration, demolition, and site preparation.

For CIS, only the actual cost of materials that the subcontractor personally bought and charged at cost can be deducted — any mark‑ups, profit, admin charges, or recharges of someone else’s materials must remain subject to CIS.

Latest update to CIS

From 6 April 2026, if a business makes or receives a payment that it knew or should have known was connected to fraud, HMRC can:

• immediately remove Gross Payment Status (GPS)
• assess the business for the related tax loss
• charge a penalty of 30%, which can apply to the business or its officers

In addition, those who have GPS removed immediately due to fraud or serious non-compliance will be prevented from reapplying for GPS for a period of 5 years.

HMRC envisage refinement to CIS will add £205 million to tax collections from the sector in the tax year 2026/2027 alone.

For more information on the Construction Industry Scheme (CIS) click here

The off-payroll working rules

The off-payroll working rules apply if a worker (commonly referred to as a contractor or contingent worker) provides their services through their own limited company or another type of intermediary (e.g. as a sole trader or through a partnership).   The rules are designed to ensure that workers pay the correct amount of tax and National Insurance contributions.  These rules are known as the ‘IR35’ rules.

The client (also commonly referred to as the engager, hirer or end client) is the organisation who is or will be receiving the services of a contractor.  The client is be responsible for determining if the off-payroll working rules apply.

From 6 April 2021, all public sector clients and medium or large-sized private sector clients are responsible for deciding worker’s employment status.

Small companies are exempt, with the definition of “small” determined based on meeting two of the three following requirements:

• turnover of less than £10.2m a year;
• balance sheet assets of less than £5.1m
• fewer than 50 employees.

CIS and the Off‑Payroll Working Rules (IR35)

Where both regimes apply, the Off‑Payroll Working rules take precedence in respect of income treated as employment income.

FIS members can download FREE the FIS Simplified Subcontract Template, designed in partnership with construction lawyer Sarah Fox.  This contract is designed to support those engaging or working as labour only suppliers (both individuals and labour gangs). 

The FIS and Sarah Fox have worked together to create a document that is:

• Clear and Concise: Stripped back to essential terms, avoiding unnecessary jargon.
• Fair and Balanced: Designed to protect both parties and encourage collaboration.
• Practical and Accessible: Easy to adopt for businesses of all sizes within the finishes and interiors sector.

By reducing complexity and ambiguity, the template aims to support stronger relationships between contractors and their labour only sub contractors and labour suppliers, helping avoid confusion, minimise disputes and improve project delivery.

The Simplified Labour Only Subcontract Template is now available to FIS members here.  

What is the CITB Levy

Who is in scope for the CITB levy

The levy applies to all employers ‘engaged wholly or mainly in construction industry activities’. In other words, when construction activities take up more than half of your total employees’ time (including subcontractors).  You can find a full list of construction activities in Schedule 1 paragraph 1 of the Industrial Training (Construction Board) Order 1964 (Amendment) Order 1992 (“Scope Order”) (External link – Opens in a new tab or window).  Specific exclusions (such as Design or installing windows) are listed at paragraph 2.  For businesses carrying out a mix of construction and non‑construction work, CITB looks at whether the business is “wholly or mainly” engaged in construction activity.  

Levy registration review

If you believe your business is not wholly or mainly engaged in construction industry activities and is incorrectly registered for CITB Levy, you can complete the levy registration review form to request CITB to review the main activity of your business further.  You can request a Levy registration review at any point, however, this process is for confirmed CITB registrations only.  If your business is currently being considered for registration, you need to complete the Levy Registration Questionnaire sent to you or respond to the Intent to Register letter, as instructed.  If you are not currently being requested a levy you are not advised to use this review form.  

Deducting levy from wages (both PAYE and Net CIS)

Although the 1996 Employment Rights Act permits deductions from earnings in certain circumstances, under the 1982 Industrial Training Act, CITB is the only organisation authorised to impose and collect CITB levy from employers in the industry. Contractors are not authorised to deduct money from workers’ wages (both PAYE and Net CIS) on CITB’s behalf.

FIS Factsheet on Deducting levy from wages (both PAYE and NET CIS)

You can calculate your CITB levy via this calculator

Movement of People – what should you be doing now?

1.  EU Settlement Scheme (EUSS)

EU, EEA and Swiss citizens resident in the UK before 31 December 2020 were required to apply to the EU Settlement Scheme.

• The main deadline was 30 June 2021
• Late applications are still possible where an individual can demonstrate reasonable grounds for missing the deadline
• Since August 2023, Home Office decision‑making on late applications has become significantly stricter

Employers who carried out a compliant right to work check before 1 July 2021 are not required to conduct retrospective checks and retain their statutory excuse.

2.  Individuals Arriving in the UK from 1 January 2021

Individuals arriving in the UK on or after 1 January 2021 (or who arrived before, but didn’t attain a Right to work under EUSS) generally require a visa to work.

The main work route is the Skilled Worker visa, which operates under the Points Based System:

• A minimum of 70 points is required
• Sponsorship by a licensed sponsor is mandatory
• The visa is linked to the sponsoring employer

Salary thresholds (updated April 2024)

The Shortage Occupation List has been replaced by the Immigration Salary List (ISL).  The General salary threshold for new Skilled Worker applicants: £38,700.  Transitional salary arrangements apply to some existing Skilled Workers.  Employers intending to recruit overseas workers must assess role eligibility, salary cost and sponsorship responsibilities carefully.

Right to works checks

Guide published by the Association of Labour Providers

As an employer it will be your responsibility to check that the individual has a right to work.  You could face a civil penalty if you employ an illegal worker and have not carried out a correct right to work check.

Additional sanctions that can be impose:

• in serious cases, a criminal conviction carrying a prison sentence of up to 5 years and an unlimited fine;
• closure of the business and a compliance order issued by the court;
• disqualification as a director;
• not being able to sponsor migrants;
• seizure of earnings made as a result of illegal working

The term employer refers to those who employ staff under a contract of employment, service or apprenticeship, whether expressed or implied and whether oral or in writing.   In the transitionary period 1 January 2021 to 1 July 2021, employers do not need to check settled or pre-settled status, just basic right to work chekcs (e.g. passport from EU will suffice), as long as you do this you get a statutory exemption from any right to work issues associated with that individual after the 1st July.  This is seperate to Right to Remain and it is imperative that people who can apply through the settlement scheme do so before the deadline of 30 June or they will lose other basic rights such as healthcare.

As long as an individual has settled or pre-settled status there is no cost implication to the employer.  If they are qualifying through the points based system a visa is required and there are cost implications, since the visa must be linked to employment you will need to register as a sponsor organisation to be able to employ new workers (i.e. those who do not have settler or pre-settled status) from the EU.

You can also check an applicant’s right to work by using an identity service provider that offers Identity Document Validation Technology (IDVT).  You can, providing they have given you their date of birth and right to work share code, check status on the Government Right to Work Checking website here.

You can find out more about Right to Work Checks Government’s employer’s guide to right to work checks.

Under the new right to work checks, if we employ a gang under a limited & pay that limited company for all the labour they’ve supplied, do you know if we need to check the eligibility of each member, or is it the responsibility of the ‘gang leader’?

Specific responsibility will be determined by nature of the contract that you have with the supplier of labour.  Although there is no legal requirement to check the RTW of those who work for a different entity, best practice will be to confirm within the contract where responsibility rests and ensure that this covers any GDPR related issues that would prohibit sharing of essential information to support compliance checking.

Once responsibility is clear, it would be sensible to exercise reasonable endeavours to audit your supply chain on a regular basis to ensure appropriate checks are taking place and also to ensure that robust procedures are in place to ensure that there is no risk to you or your workforce under the Modern Slavery Act.

For the avoidance of doubt – labour only subcontractors who work under a contract for services and who are subject to the direction and control of the end user, will be workers and therefore subject to RTW checks by their employer.

Managing Right to Work through a VISA process

To become a sponsor you will need to apply for a sponsor licence.  We have been advised that the application process can take up to eight weeks.

Remember you do not need to be a sponsor to recruit Irish citizens or anyone from the resident labour market with an existing right to work in the UK.  This includes EU citizens with settled or pre-settled status, and non-EU citizens with indefinite leave to remain in the UK.

Guidance around Self-employment remains unclear, but there are processes that support the sponsorship of sub-contracted workers (arriving after the 31 December 2020), however, these must be sponsored and guidance currently states. “Where a worker is not your direct employee, we will look closely at the arrangement to make sure you can fulfil your sponsor duties and we will take action against you if we find you are not.”

Modern Slavery can take many forms including the trafficking of people, forced labour, servitude and slavery. Construction remains high risk particularly in terms of forced labour. Employers and most notably companies engaging workers through gangs and labour agencies must be vigilant. It is estimated that there are approaching 140,000 people currently impacted by Modern Slavery in the UK.

Visit the FIS Modern Slavery Toolkit here

Essential part of a manager’s role is identifying roles and responsibilities and delegating.  Applying the RACI model can help in terms of breaking things down, deciding how each task contributes to your overall goal and how this can be measured.

The RACI model is a straightforward tool used for identifying roles and responsibilities, ensuring all tasks are allocated effectively that there is no confusion over those roles and responsibilities during a project. The acronym RACI stands for:

Responsible: The person who does the work to achieve the task. They have responsibility for getting the work done or decision made. As a rule this is one person; examples might be a business analyst, application developer or technical architect.

Accountable: The person who is accountable for the correct and thorough completion of the task. This must be one person and is often the project executive or project sponsor. This is the role that responsible is accountable to and approves their work.

Consulted: The people who provide information for the project and with whom there is two-way communication. This is usually several people, often subject matter experts.

Informed: The people who are kept informed about progress and with whom there is one-way communication. These are people that are affected by the outcome of the tasks so need to be kept up-to-date.

A RACI matrix supports the model and is used to discuss, agree and communicate roles and responsibilities.

FIS has developed a template RACI matrix to support members, it is available to download here –Template FIS RACI Tool

Competency Management is covered in more detail in the FIS Guide to Competence Management.

What is Redundancy?

Redundancy is a form of dismissal when employers need to reduce their workforce. Workers being made redundant may be eligible for certain things, including:

• redundancy pay
• a notice period
• a consultation with your employer
• the option to move into a different job
• time off to find a new job

If an employer is proposing to make redundant 20 or more employees at one establishment within 90 days, legal requirements regarding collective consultation apply.

Read the ACAS Factsheet on Collective Redundancies here

Redundancy pay

How much redundancy pay a worker is entitled to depends on:

• your age
• how long you’ve worked for your employer

You may be required to offer more than the minimum amount the law says you should get (‘statutory’), if it’s in your contracts.

You can us the Government Redundancy Pay Calculator here

ACAS have developed a full redundancy toolkit including template resources here

FIS Members can access the Employment law helpline via 0121 707 0077

If you have workers who travel to the EU for work purposes, they may need to apply for a visa or work permit.

The COVID-19 virus has put strain on businesses across the construction sector. Previous downturns have taught us that companies who take decisive action to manage short-term issues are more likely to survive the longer term. Loyalty to your employees requires leadership and a times you may be required to make some difficult decisions to protect future jobs. Below we look at some of your options.

What is a lay-off?

When employees are not provided with work by their employer, and the situation is expected to be temporary, they are regarded as laid off.

In what circumstances can an employee be laid off?

This can be done where there is an express contractual right agreed between employer and employee.

The right of an employer to lay off may also be implied if it can be shown (by clear evidence) that it has been established over a long period by custom and practice.

Both parties may agree to alter the contract terms so that the lay-off is not a unilateral act by the employer but by mutual agreement (for example, where the only alternative is redundancy).

Do employees have any right to payment during a period of lay-off?

Not if there is a specific term in their contract allowing you to lay them off without pay. When they are laid off, they might be entitled to a statutory guarantee payment from you, limited to a maximum of five days in any period of three months. The daily amount is subject to an upper limit which is reviewed annually. On days when a guarantee payment isn’t payable, employees might be able to claim

On days on which a guarantee payment is not payable, employees may be able to claim Universal Credit (in light of the Coronavirus situation, the ability and process for claiming has been simplified). More information is available here.

How long can a lay-off last?

This will depend on the terms specified in the contract. However, the employee may in certain circumstances give his or her employer written notice of an intention to claim a redundancy payment. If there is no contractual right or agreement the employee may try to claim breach of contract or unfair dismissal.

What is short-time working?

Short-time working occurs when employees are laid off for a number of contractual days each week, or for a number of hours during a working day.

As in the case of a lay-off, the employer must have an express or implied power in order lawfully to reduce the amount of pay. Normal practice would be for the workforce or their union to agree to short-time working as an alternative to redundancies.

Where there are no express or implied rights to short-time working, employees may claim that the employer’s action amounted to a dismissal (constructive or otherwise) and complain to an Employment Tribunal of unfair dismissal.

They may also sue for loss of wages in a civil court or, in certain circumstances, in an Employment Tribunal or claim that the employer has made an unlawful deduction of wages under Part II of the Employment Rights Act 1996 (to an Employment Tribunal only).

Again it may be possible for employees to access support through Universal Credit and more information available here.

Can a claim be made for a redundancy payment because of lay-off or short-time working?

If an employee is either laid off (that is, receives no wages) or put on short time working (that is, receives less than half a week’s pay) for four consecutive weeks – or for six weeks in a period of 13 weeks – because of a shortage of work, the employee can give the employer written notice that he or she intends to claim a redundancy payment.

You can access the full ACAS guide to Short Term Working and Lay-off here

FIS Members can access the Employment law helpline via 0121 707 0077

Useful resources

COVID -19 Letter putting employee onto furloughed scheme UPDATED 24.3.20

COVID-19 Short-Time Working letter

COVID -19 Lay-Off Notification

In light of the spread of COVID-19 more people are being asked to work from home.  Some are used to this and others not, below is an example of information circulated by FIS Member Mansell Finishings to their team to advise on some bits of good practice for you to observe.

1. Get Dressed – maybe not in full smart business attire but sitting there in your PJs will start you off on the wrong footing and you will sub consciously not feel like you are ‘at work’
2. Plan your work area – set up a comfortable and as private as possible space and make sure those in the house with you understand that you have to work.
3. Plan your tasks each day – sounds obvious but this is more important than ever when working from home. Your line manager should be doing this with you anyway and checking in with you but it pays to be self sufficient and pro-active in this area.
4. See it as a productivity challenge – If managed correctly you can get more work done from home. Deal with the small tasks and the big project type stuff too. Eg. Use the first hour to get rid of the niggly little tasks best you can and then start to work on those ‘big’ tasks. You know the ones you have been putting off for a while but in your hearts of hearts you know need doing. This is the type of stuff that always goes on the back burner when in the office because of distractions, well now you can concentrate in peace and get it done
5. Stick to your normal working hours – don’t be tempted to lie in till 10am and then work late for example. If you normally work 8.30am till 5pm with ½ hr lunch then stick to these hours. And don’t stay up till 3am watching Netflix because you know you are working from home the next day!! Go to bed when you normally do on a school night
6. Stay Active and take breaks – get up and move around. If your able to go out for a little walk on your lunch break then do so.
7. Don’t get distracted – Don’t have the TV on in the background and switch off social media apps (if you don’t use them for work) or certainly the notifications for them. You can always check them at lunchtime or on breaks etc.
8. Phone people – find a reason to ring your colleagues rather than just e-mailing, it is important to still have some form of human interaction. Better still use some form of video call to communicate with your colleagues.

Thanks to Paul Rigby, Mansell Finishes Limited, Head of People for sharing this. 

Additional support: 

ACAS advice on homeworking is available here

FIS Associate Citation have produced for us a detailed guide to temporary homeworking due to coronavirus, support for employers and employees – you can access the toolkit here

After several years of travel restrictions, the UK is heading for a huge holiday season this year, and many employers will have been receiving an influx of holiday leave requests in recent weeks. As an employer, it is important to know your responsibilities when it comes to calculating annual leave. FIS HR & Employment partner Citation, have put together this handy guide.

All companies should have a formal Electronic
Communication Policy. A template policy below is provided for members to adapt as necessary to suit their company needs.

• Employment – Electronic Communications Policy

• Benefits of Management and Leadership Development
• Benefits of Supervisory Management Development
• Briefing the team
• Corporate Social Responsibility Policies
• Culture and People

• The new CIJC Pay rates and allowances for 2025-26 are available here
• The 2025 CIJC Annual Holidays are available here
• it is advised that they are read in conjunction with the CIJC Working Rule Agreement

Empoloyers are legally required to offer pensions to their workforce.  To support you in fulfilling your responsibilities, the Department of Work and Pensions (DWP) has created a free, bespoke toolkit of support materials including posters, flyers and letters for our sector to help members answer employees’ questions about workplace pensions.  

You can access the DWP Pensions Toolkit here

Guidance on Automatic Enrolment for Workplace Pensions is available here

Midlife pension review for the self-employed
If you are self-employed and not sure how to deal with your pension, or feel a bit lost when it comes to retirement planning, then Money Helper has a dedicated appointment service, called Midlife Pension Review, which can help you with what this means for you and your pension.