The Building Industry Bargaining Council has warned that unregistered contractors pose serious safety risks following recent fatal building collapses in George and Ormonde.

Speaking on 14 April, Danie Hattingh, spokesperson for business at the Building Industry Bargaining Council (BIBC), said building failures stem from more than just engineering problems.

“Building collapses are often framed as engineering or safety failures, but we repeatedly see a breakdown in labour compliance and site control,” Hattingh said.

Up to 38% of South Africa’s construction sector operates outside formal systems, according to International Labour Organisation figures cited by the BIBC.

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This widespread non-compliance allows contractors to undercut legitimate firms by an estimated 25% to 35% by avoiding statutory obligations including UIF, PAYE, and COIDA contributions.

“Cheap labour is not a competitive advantage. It is a liability that undermines compliant businesses and weakens sector resilience,” Hattingh warned.

The practice of keeping workers “off the books” to avoid levies creates serious traceability problems, particularly during emergencies.

“When workers are not registered, documented, and traceable, the system fails,” he explained.

Legal liability remains with principal contractors

Despite complex subcontracting arrangements, principal contractors and developers retain ultimate legal responsibility under the Occupational Health and Safety Act and Construction Regulations.

“Principal contractors may think risk is shifted through these arrangements, but the law is clear: you can delegate work, not accountability,” Hattingh said.

The financial consequences of non-compliance are severe, with single audits potentially triggering back-pay, penalties and interest running into hundreds of thousands of rand.

“In fatal cases, unpaid benefit obligations can reach up to R500 000 and more per deceased worker,” he added.

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The BIBC announced that enforcement activity will intensify in 2026 through multi-agency high-impact task teams involving the Department of Employment and Labour, SARS, Home Affairs, the police, and the BIBC.

These teams have powers to issue immediate prohibition notices and shut down sites for serious non-compliance.

Hattingh said enforcement will particularly target private estates and high-value developments as the industry moves away from the “passive client” model.

“Where systems are not integrated into a unified compliance framework, accountability fragments and traceability weakens,” he explained.

Digital integration recommended

The BIBC is calling for integrated systems that align labour records, contractor registration, and site access control in real time.

“What is required is an integrated system where labour records, contractor registration, and site access control are aligned, ideally digitally and in real time,” Hattingh said.

He emphasised that compliance checking should become standard practice when appointing contractors.

“For those appointing contractors, the questions are non-negotiable: is the contractor registered, are workers documented and compliant, and who is actually on site?” he said.

“Because when cost-cutting replaces compliance, the consequences extend far beyond the construction site.”