As a labour-intensive industry, civil engineering has long played a pivotal role in stimulating the growth of small businesses and subcontractors. However, while the sector creates opportunities for emerging contractors, labour compliance can present a significant barrier to entry – particularly where both large and small players do not actively embrace it as a shared responsibility.

According to Bargaining Council for the Civil Engineering Industry (BCCEI) operations manager Lindie Fourie, many emerging contractors lack the systems and administrative capacity required to manage labour compliance effectively and, in addition, may not fully understand the scope of their obligations.

“Owing to their size, they often don’t have dedicated human resources to handle compliance duties. Their focus is on securing work and delivering on site, so administrative requirements can easily become secondary.”

Despite these challenges, labour compliance remains a nonnegotiable pillar of the civil engineering sector, regardless of company size. Importantly, it does not have to be a burden for smaller subcontractors, as structured support mechanisms are already in place.

“The sector is committed to transformation and localisation, so there is no reason for small businesses to be excluded or noncompliant. The BCCEI provides guidance and support and many larger contractors run supplier and enterprise development programmes that assist emerging subcontractors,” Fourie explains.

Labour compliance includes adherence to collective agreements, minimum wages, benefits and reporting requirements. The BCCEI is mandated to regulate labour relations within the sector, providing a structured platform for organised labour and employers to negotiate collective multi-year agreements.

“The issue of minimum wages is critical to sector stability as it ensures a level playing field for all companies. Collective agreements set the minimum standards so that every employee receives a fair wage and the BCCEI ensures compliance through its inspection processes,” Fourie says.

A key focus of the BCCEI’s awareness initiatives is ensuring that smaller subcontractors understand and apply these minimum wage requirements when preparing their tenders and paying their employees. On a civil engineering project, all contractors and subcontractors are expected to operate under the same rules. This protects workers across the value chain, whether they are employed by the main contractor or a subcontractor.

“Compliance is vital,” she adds. “Without it, companies could undercut competitors by paying unfair wages. Given how labour-intensive construction activities are, wages represent a significant portion of project costs.”

Fourie highlights the important role that larger contractors can play in strengthening compliance through enterprise and supplier development programmes. These initiatives typically include mentoring, supervision and structured support to help emerging subcontractors build capacity, improve governance and operate sustainably.

“If contractors raise awareness about labour compliance and the BCCEI within their subcontractor base, projects are far more likely to run smoothly. Subcontractors need to understand compliance requirements before they even submit a formal quotation so that they can budget accurately for minimum wages and related obligations,” she explains.

Fourie stresses that meaningful transformation extends beyond awarding work to smaller firms. It requires equipping them to operate lawfully and sustainably within a regulated environment.

“Labour compliance must form part of procurement and enterprise development strategies. Without compliance, subcontractors risk fines, back-pay liabilities and, in severe cases, being unable to complete the work. This can lead to job abandonment and disrupt the broader project.”

Where compliance failures result in subcontractor withdrawal, the consequences can ripple through the entire project ­– causing delays in service delivery, additional procurement costs and reputational risk for larger contractors.