Construction sector

The construction industry has direct and often detrimental impacts on human rights, particularly in the areas of workers’ rights, community and land-rights, environmental protection (e.g. dams, large hydro-electric projects) as well as rights to life and health of communities and workers.

The global construction market is anticipated to expand by US$4.5 trillion to US$15.2 trillion in the next 10 years, with China, India, the US, and Indonesia accounting for 58.3% of the forecast growth. Construction that is sustainable, ethically conducted and based on innovative products and solutions is crucial to achieving Sustainable Development Goals 9 to “Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation” and Goal 11 to “Make cities and human settlements inclusive, safe, resilient and sustainable”. These goals are particularly important given that by 2050, there will be two billion additional city dwellers. Since it relies on large numbers of low-skilled workers, it is a major provider of formal employment opportunities around the world and could play an important role in ensuring that workers’ rights are respected.

However, workers’ abuse, environmental damage, displacement of local communities caused by large-scale construction projects, such as those involving infrastructure development, and in some cases the threat to human life as a result of poorly constructed buildings are regularly reported. The risks and complexities inherent in the construction sector, such as, high competition, tight fixed deadlines, low profit margins (about 2%), and heavy reliance on multiple-layered sub-contracting make it a high-risk sector in terms of human rights (IHRB, June 2016). It is also often under-regulated by local governments and It is also recognised as a high-risk sector for corruption. Moreover, as a labour-intensive sector where temporary and irregular work is common, as well as low-skilled and low-waged jobs, it is a high-risk sector for forced labour.

The construction sector attracts millions of migrant workers, primarily to the Gulf States but also to other places where large-scale events including mega-sporting events take place, to work on large-scale infrastructure projects. Many countries are undertaking or plan to undertake large infrastructure projects such as dams, ports, roads, rails, pipelines in a bid to modernise or boost economic activity. A significant number of these projects are being undertaken through the private-public-partnership (PPPs) model hence an increased role of the private sector and an added risk and opportunity for human rights given if undertaken in line with human rights based approach. The 2022 World Cup in Qatar was subject of international concern due to the poor working conditions for migrant workers. The government reported that 30,000 foreign laborers were hired just for the stadium. Human rights groups have criticized Qatar for the treatment of foreign workers. Issues such as squalid living conditions, recruitment fees, withheld wages, and confiscated passports have been highlighted.

Stakeholders have developed various Guidelines (e.g. Human Rights Watch, Guidelines for a Better Construction Industry in the GCC: A Code of Conduct for Construction Companies) and recommendations (e.g. BSR Working Paper on “Addressing Workers’ Rights in the Engineering and Construction Sector – Opportunities for Collaboration”) to help companies improve their human rights performance. They have also suggested a number of recommendations to improve workers’ rights in this sector. ‘Building Responsibly’ is a global engineering and construction industry initiative established to promote the rights and welfare of workers. This initiative works by developing common approaches and standards, sharing learning and tools, and engaging workers and other stakeholders on the specific challenges companies face.

The Institute for Human Rights and Business has developed the Framework for Dignity in the Built Environment, linked to existing standards and the Sustainable Development Goals. The Framework aims to guide decision-making and strengthen collaboration, in order to mitigate risks to human rights and maximise social outcomes throughout the built environment lifecycle. The Mega Sporting Events initiative by the Institute for Human Rights and Business brings together multi-stakeholders working together to address human rights issues throughout he lifecycle of large sporting events of which construction of supporting infrastructure in the host countries is major stage and often fraught with human rights concerns.

Legislative reforms, such as state-led labour law reforms can be complemented by rather than replaced by civil society efforts, or industry or company led codes of conducts. Some of these initiatives were, in fact, developed as a response to increased transparency regulations. For instance, since the Sarbanes-Oxley Act of 2002 began requiring public companies to disclose whether they have adopted a code of ethics, some companies and their associates have chosen to adopt and disclose their own code of ethics, even though compliance is only voluntary for privately held companies. See e.g. the American Subcontractors Association “Model Code of Ethics for a Construction Subcontractor”).

The construction sector is of significant importance for the achievement of sustainable development goals (SDGs) as it impacts on all three dimensions of the SDGs; economic, social and environmental. This sector can contribute to the achievement of many goals including building resilient infrastructure (SDG 9) and “making cities and human settlements inclusive, safe and sustainable” (SDG 11), and to climate change adaptation and mitigation (SDG 13). All of these SDGs have human rights dimensions. Construction can also be a hazardous sector and one that relies on many low-skilled, often migrant, workers. Thus, it also plays a crucial role in protecting workers’ rights and ensuring a safe and secure working environment compliant with international labour standards (SDG 8.8). Activities of the construction sector under all these Goals also have implications for land rights (SDGs 1.4, 2.3, 5a), where adequate due diligence is crucial to ensure adequate respect for communities’ and individual land rights.

8) Decent Work and Economic Growth

9) Industry, Innovation and Infrastructure

11) Sustainable Cities and Communities

12) Responsible Consumption and Production

References

Business & Human Rights Resource Centre: Sector – Construction
R. Nieuwenkamp, The Global Construction Sector Needs a Big Push on Corporate Responsibility, OECD Insights, 22 August 2016
Collaborative initiative “Building Responsibly” for an engineering and construction industry
Human Rights Watch, Guidelines for a Better Construction Industry in the GCC: A Code of Conduct for Construction Companies, 2015
The Western Australian Building and Construction Industry Code of Conduct 2016
Australian Procurement and Construction Council, National Code of Practice for the Construction Industry Towards Best Practice Guidelines, 1999
OHCR, Report of the Special Rapporteur on the Human Rights of Migrants, A/HRC/26/35, 2014
IHRB Briefing, OECD National Contact Points and the Construction Sector, June 2016
J. Wells with B. Fernz, Improving employment standards in construction in Qatar. Final Report.; Engineers Against Poverty, July 2014
ITUC, Frontlines Report 2015, Qatar: Profit and Loss—Counting the Cost of Modern Day Slavery in Qatar: What Price Is Freedom?, 2015
M. Bhacer, The construction industry must step up on human rights, The Guardian, 19 April 2016
HRW, Red Card Exploitation of Construction Workers on World Cup Sites in Russia, 2017
J.-B. Andrieu, A. Ucla, and M. Lee. “Addressing Workers’ Rights in the Engineering and Construction Sector – Opportunities for Collaboration” Working Paper, 2016. BSR, San Francisco
LexisNexis, Hidden in Plain Sight Site. Modern slavery in the Construction Industry, 2016
Amnesty International, The Ugly Side of the Beautiful Game: Exploitation of Migrant Workers on a Qatar 2022 World Cup Site.
Nardello & Co., Report of the Independent Investigator into Allegations of Labor and Compliance Issues During the Construction of the NYU Abu Dhabi Campus on Saadiyat Island, UAE, 2015
N. McGeehan, Lawsuit Reveals Challenges Facing Construction Firms, L’Obs, June 22, 2016
Royal Institute of Chartered Surveyors (RICS) and United Nations Global Compact, Advancing responsible business practices in land, construction and real estate use and investment, 2015.
BRE Group, 2016. ‘Construction sector needs to address modern slavery in its supply chain’. BRE Group,
BRE, 2016. Modern slavery and ethical labour in construction leadership symposium. [online] Available at: http:// www.msa4construction.com/

What National Action Plans say on Construction sector

Belgium (2017 - open)

Action point 26

Pay particular attention to the ratification of a series of ILO conventions to health and safety at work

Accorder une attention particulière à la ratification d’une série de conventions de l’OIT ayant trait à la santé et la sécurité au travail

This section includes a plan to ratify Convention No. 167 on Safety and Health in Construction. The government comments “the ratification of this Convention will be deposited in Geneva in June 2016.”

Administrative courts and their opportunities to review and annul follow-up decisions [page 51]

“It is often the case that complex authorisation proceedings do not take place as a whole, but comprise a many sub-proceedings and decisions that follow up on each other and are intertwined. If one decision is annulled by a special remedy (review proceedings or an administrative action), the downstream decisions formally remain in force even though they have been robbed of their basis. One example is building permit proceedings, where the issuance of a building permit hinges on the existence of a valid zoning decision. If a court annuls the zoning decision (or even part of the land-use plan forming the basis for the issuance of the zoning decision), the building permit remains in force. This falls foul of the principle of procedural economy (the annulment must take place in a separate process, even though this is a pure formality in the overwhelming majority of cases). It is also contrary to the requirement of legal certainty (the decision remains in force and enjoys the presumption of correctness, even though it obviously needs to be annulled), and is at odds with the principle of legality (because a decision that is clearly not legal remains in force).”

Integration of authorisation proceedings [page 53]

“The lack of uniformity of provisions in administrative law is reflected negatively in the issuance of permits and opinions in particular. An investor intending to implement a large-scale plan affecting multiple areas requires numerous individual permits and opinions from various bodies. In this respect, the Czech legal system is highly fragmented. Permits are issued in accordance with laws on building …

Current state of play:

An amendment to the Building Act adopted in 2017 led to the partial interconnection of zoning proceedings, building permit proceedings, EIA procedure and several other necessary authorisation proceedings.”

The state duty to protect human rights

2.4 Planned action

Increasing the use of labour and social clauses in public contracts [page 16]

“The current labour clause threshold value of approximately DK K 37.5 million for public construction projects included by the labour clause requirement will be abolished. In the future, governmental contracting authorities (including companies that are fully owned by governmental authorities and not in competition) must use labour clauses in all public tender calls for construction projects.”

3 Expectations towards companies and support services

3.5 Support for Finnish and international organisations promoting the subject [page 29]

“In 2014, approximately EUR 17 million were spent to support the projects of the International Labour Organisation (ILO). The projects are related to matters such as rights at work, green workplaces for the construction sector, the inclusion of women in the labour market, and decent work.”

II. Premises

b) Italy and the UNGPs

“The NAP (…) introduces limited objectives and actions, with reference to the national context translated into the following priorities:

The fight against caporalato (especially in the agricultural and construction sectors) and forms of exploitation, forced labour, child labour, slavery and irregular work, with particular attention to migrants and victims of trafficking” (p. 10)

c) National Priorities

“6. Strengthening of legislative and policy measures relating to the prevention an combating of the phenomenon of ‘caporalato’ (especially in the agricultural and construction sectors).” (p. 11)

ANNEX 1 – Accountability Grid and Assessment Tools for the Implementation of the NAP

“14. Update the information on the current legislative framework to combat illegal work and labour exploitation in the agricultural, construction, manufacturing and service sectors.” (p. 63)

Chapter 2. Action Plan

2. Areas of the NAP

(2) Measures of the Government as an Actor regarding State Duty to Protect Human Rights

A. Public Procurement

(Existing framework/Measures taken）

…, the revision of the Act on Promoting Quality Assurance in Public Works (Act No. 18 of 2005) in 2019 set forth the obligations of the commissioning entity, such as setting appropriate periods for construction projects and ensuring that they are allocated evenly throughout the year as opposed to being concentrated in the same period. The revision also included a new requirement for a wide range of surveys regarding public works to be carried out. In addition to this, the Construction Business Act (Act No. 100 of 1949) and the Act for Promoting Proper Tendering and Contracting for Public Works (Act No. 127 of 2000) were revised in 2019 to promote work style reform in the construction industry, including redressing long working hours (e.g. appropriate construction period) and improvement of treatment of workers at construction sites.

(Future measures planned）

Thoroughly implement procurement rules relevant to business and human rights, including grievance procedures (initiatives based on Act on Priority Procurement Promotion for Persons with Disabilities, initiatives related to public procurement based on Article 24 of the Women’s Participation Act, and initiatives concerning exclusion of organized crime groups)

(…)

Continue to promote measures to exclude organized crime groups from public works, etc in accordance with the Initiative on Exclusion of Organized Crime Groups from Public Works, etc. (Agreement by the Working Team on Comprehensive Measures, Including the Control of Organized Crime Groups dated December 4, 2009). [All Ministries]

(…)

Continue to promote work style reform in the construction industry to deepen understanding of the purpose of the Act on Promoting Quality Assurance in Public Works, Construction Business Act, the Act for Promoting Proper Tendering and Contracting for Public Works, and the guidelines for these acts. [Ministry of Land, Infrastructure, Transport and Tourism]

D. Tasks for the Third NAP

Institutionalization of Human Rights Management

3. Public procurement considering social responsibility [page 5]

Give additional 10% point on management condition mark when female·disabled friendly companies or social enterprises record construction ratio over 30% according to detailed guidelines of qualification examination on facility construction (Public Procurement guidelines)

…

Guiding Principle 3

Measure 5

“The implementation will be promoted by business and trade unions, general or sectorial, including representative organizations of social economy entities; as well as other institutions such as chambers of commerce, chambers abroad, universities, business schools, etc. of actions that should promote online training and advice and Resolution of queries, coordinated with those carried out in the application of the Spanish Strategy of Corporate Social Responsibility.”

Measure 6

“In accordance with the recommendations of the EU, the Government will promote information and training of SMEs and social economy entities, through all available means in business associations, and will promote the creation of sectorial forums of learning in order to discuss good practices and to reach commitments of interest for each sector.”