EurWORK European Observatory of Working Life

Laing O’Rourke, UK: Integration into the labour market of people at risk of exclusion – early school-leavers and long-term unemployed

About

Country: 
United Kingdom
Organisation Size: 
Large
Sectors: 
Construction and woodworking
Category: 
integrating people at risk of exclusion into the labour market

Laing O’Rourke’s response to the recruitment problems faced by the Scottish construction industry is to look at the possibilities of getting more local people back to work. The company has taken initiatives to support in particular long-term unemployed people, young school-leavers and refugees. These categories are the target groups of the company’s integrated policy of corporate social responsibility. The company believes that, by creating a trained pool of labour, it can contribute to an increased supply of skilled workers for the construction industry.

Organisational background

Laing O’Rourke Scotland is part of the international Laing O’Rourke construction company that employs 23,000 people worldwide, with over 12,000 workers in the UK and around 700 employees in its direct labour force in Scotland. Overall, the business has a turnover of GBP 2.1 billion (about €3.07 billion as at 3 May 2007). The company was created in 2001 with the merger of the two companies Laing Construction and R.O’Rourke and Sons.

At present, Laing O’Rourke is the fifth largest construction company in the UK and the biggest private construction company. Its operations take in major infrastructure projects as well as residential building and a range of other construction-related services such as engineering and structural demolition.

The company is unusual in having an advisory panel made up of academics and specialists, which the company consults on strategic and innovative issues relating to performance and investment.

The company has set up an information and consultation forum to comply with European Directive 2002/14/EC establishing a general framework for informing and consulting employees. The forum includes 20 representatives from the various areas of the company and met for the first time in March 2006. The company also recognises and works with trade unions where appropriate, depending on the particular project. Negotiations normally take place with the Union of Construction, Allied Trades and Technicians (UCATT), but they can also involve the Transport and General Workers’ Union (T&G), the GMB general union and the technical and professional union Amicus.

The government has launched a range of initiatives to reduce the number of long-term unemployed people in the country. These include, in particular, the ‘New Deal’ schemes which aim to get younger and older workers as well as single parents into employment.

Description of the initiative

Laing O’Rourke is a company that places a considerable emphasis on employee development and training. In fact, it is one of a very small number of companies to produce a detailed report on its workforce in terms of sex and age distribution, levels of qualifications and participation in training. It also puts a significant emphasis on corporate social responsibility (CSR), having created a CSR department to implement relevant policies and to integrate them into the company’s activities.

In 1999, the company realised that it had to respond to the shortage of skills and labour in the Scottish construction industry. Rather than just look at this in narrow labour supply terms, the CSR department played a role in developing a long-term plan that would consider the company’s needs, the supply of skilled labour to the industry as a whole, as well as social inclusion issues that were central to its thinking on CSR.

Since then, Laing O’Rourke Scotland has launched a number of initiatives to increase the employability of people at risk of social exclusion in the communities in which it operates. Target groups in this regard include long-term unemployed people, young school-leavers as well as migrant workers and refugees.

Part of Laing O’Rourke’s approach to this issue is to challenge some of the mainstream views on these groups of people. This is not just a question of tackling individual prejudice but also fighting exploitation of the vulnerable position of these people. In 2004, the Head of CSR at Laing O’Rourke Scotland, Jim Gaffney, told a Scottish trade union congress conference on integrating refugees and asylum seekers into employment about his ‘very, very positive’ experience of working with refugees and asylum seekers. He also showed his awareness of how many employers were exploiting these workers on a regular basis by keeping them off the official books and paying them less that the national minimum wage.

The company’s main initiative in relation to long-term unemployed people has been to establish the ‘Upskilling the long-term unemployed into construction’ partnership. This venture brings together local enterprises, job centres as well as industry training organisations to provide advice, training and help to long-term unemployed people in the hope of helping them to find a suitable job.

A challenge facing the company is the ability to respond to the changing labour demands on the various projects it is involved in. Senior managers liaise with the CSR department to identify skills needs and labour requirements as new projects come on stream. The company then works closely with local agencies to help identify and contact the target group. It believes that this partnership with the government in the ‘Jobcentre Plus’ and New Deal schemes and with voluntary organisations on the ‘Progress2work’ initiative is important in communicating with and understanding the target group, whether it is long-term unemployed people or migrant workers.

Laing O’Rourke undertakes community liaison through open days and offers lifelong learning and staff mentoring initiatives to provide long-term unemployed people with the necessary skills for the job, as well as any additional support they might need to (re)integrate into the workforce.

The company has worked with local training organisations and established a flexible approach to training so that former long-term unemployed people get appropriate training at the right time rather than having to wait to join specific courses at set times. For example, 20 New Deal clients were able to take part in a general training programme on construction operations designed and delivered by local partners – the Greater Easterhouse Development Company, Queenslie College and Jobcentre Plus – when they were recruited to work on the Glasgow Fort retail park project.

Analysis

Examples of the impact of Laing O’Rourke’s policies include its GBP 13 million (€19 million) Glasgow Airport multi-story car park project where 46 workers (23% of the entire workforce) are former clients of the ‘New Deal 25 Plus’ scheme, which is designed for unemployed people aged 25 years and older .

On its Cala Homes Glasgow Harbour project costing GBP 21 million (€30.9 million), the company took on five local people as apprentice joiners. In addition, 11 New Deal and two incapacity benefit clients were employed and were able to undertake a Scottish Vocational Qualification (SVQ) training programme in general construction.

The company directly employed 36 long-term unemployed people on its GBP 13 million (€19 million) Gogarburn project in Edinburgh which involved the construction of the new worldwide headquarters for the Royal Bank of Scotland (RBS). It recruited another two long-term unemployed people on the Edinburgh Airport multi-storey car park project.

At present, Laing O’Rourke also has 19 permanent resource efficiency technicians working across its various business units who were formally unemployed on a long-term basis.

The company argues that there is a sound business case for tapping into the unrealised talent and skills of local people who just need some extra help to (re)integrate into the labour market. It has no doubt that it is creating a trained pool of labour that is highly motivated and committed and thus is contributing to an increased supply of skilled workers for the Scottish construction industry.

Moreover, the company is aware of the benefits these kinds of policies can have in terms of its image as a socially responsible employer. The company also recognises the way such policies might enhance its reputation particularly among public sector organisations, with which it could potentially pursue its interest in Private Finance Initiative projects and Public-Private Partnerships.

Apart from benefiting those who are at risk of social exclusion, Laing O’Rourke also believes that its initiatives have an impact on its existing workforce. Such initiatives contribute to their personal development as the workers come in contact with groups of society which they would not otherwise have encountered and about whom they may have held certain prejudices.

Exemplary and contextual factors

Laing O’Rourke stands out in the construction industry as a company willing to challenge prejudices in relation to long-term unemployed people, as well as refugees and migrant workers. It also considers CSR as an integral part of its operations. The company recognises that the initiative is not merely about helping long-term unemployed people to take part in one-off projects, but it is also about establishing a lasting employment initiative. This has resulted in the company employing many workers who would otherwise have remained cut off from the labour market.

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