Cultural change vital for improving diversity in UK infrastructure sector in 2024

Businesses across the UK’s infrastructure sector have continued the momentum in driving industry change by implementing campaigns designed to accelerate cultural transformation and address historic misconceptions around the sector being dominated by men with spades in the ground engaged in hard labour.

Through these campaigns, businesses have highlighted their commitment to valuing differences; rolling out new policies, procedures and training to create positive behaviours and empower people to challenge unacceptable conduct when they see it; ensuring effective reporting mechanisms are in place; and taking robust action when someone crosses the line.

These initiatives mark a vital shift change in making workplaces fairer and more inclusive, diverse and respectful. Businesses in the sector have worked to ensure that this message resonates with their wider workforce by highlighting that a commitment to “safety-first” extends to psychological safety, which is inextricably linked to workplace culture.

In September, the Construction Inclusion Coalition was launched, to coordinate and measure the industry’s progress in tackling its lack of diversity. The Construction Leadership Council endorsed the coalition, with its co-chair saying that “it is clear that ensuring a consistent approach to equity, diversity and inclusion will be vital for the future of construction”.

That increased focus on diversity is essential. The industry is vital to the economic and social wellbeing of the UK - to address issues of our times such as the climate crisis, population growth and rapid technological change. That demands that it be seen as a career of choice, to recruit, inspire, develop, promote and retain sufficient, and sufficiently diverse, resources. It also requires that the workforce have a collective diversity of thought, experience and approach, to solve the complex problems it can throw up.

Construction law expert Louise Forster of Pinsent Masons, who this year was appointed to the Council of the Society for Construction Law, said: “There is a growing realisation amongst businesses in the infrastructure sector that creating a diverse and inclusive working environment is not just a ‘nice to have’ but a commercial imperative. Workplace culture is increasingly scrutinised externally by other stakeholders, such as customers and investors, as part of ESG reporting and monitoring and is a vital work winning, recruitment and retention tool. This is why EDI considerations consistently sit at the very top of the boardroom’s strategic priorities.”

Regulatory landscape in 2024

In the coming year, the industry can expect a raft of policy and legislative developments, which will help to turbo-charge this cultural transformation in the sector.

In 2024, draft legislation to regulate non-disclosure agreements (NDAs) is awaited in UK. It is also expected that a new proactive duty for employers to take reasonable steps to prevent sexual harassment will be introduced, with the risk of a potential 25% uplift in compensation if they fail to do so.

The UK government finalised employer guidance in 2023 to ensure responsible and accurate reporting of ethnicity data. The outcome of the government review of the gender pay gap regulations is also awaited and may produce changes to the current framework to help address frustrations at the slow pace of progress.

According to analysis by Pinsent Masons, the average median pay gap between male and female employees working for the infrastructure companies is 21.2% in 2022-23. The latest figure shows an increase of almost two percentage points from the previous year.

EU-wide employers will also need to prepare for the implementation in 2024 of the Corporate Sustainability Reporting Directive and thereafter of the EU's Pay Transparency Directive which will have a seismic impact on reward strategies.

Family-friendly rights have also been an area of focus. In the UK, businesses need to prepare for the following new obligations which will soon come into force:

• a new right to paid leave for parents of babies requiring neonatal care (expected April 2025);
• leave for unpaid carers (expected April 2024);
• giving pregnant women and new parents greater protection against redundancy (expected 2024); and
• a day one right to request flexible working (expected April – August 2024).

As part of their initiatives to recruit and retain workers and in particular to increase female representation, businesses may want to consider supporting career break returners in line with recent government guidance for employers.

While small steps have been taken by companies in the sector, maintaining this focus on the importance of culture will ensure that a career in construction is considered an attractive option by under-represented groups and ‘Gen-Z’ and help to address the vital skills shortages which will affect all major infrastructure, construction and housebuilding projects over the coming years.

Diversity in construction law and dispute resolution

This year is the 25^th anniversary of statutory adjudication coming into force, and it also saw a drive to improve the number of women adjudicators. Women in Adjudication launched the Equal Representation in Adjudication Pledge, now adopted by 92 organisations and 300 individuals, which proposes the appointment of women as adjudicators on an equal opportunity basis. It aims to improve on the startling statistic that, currently, only 7.88% of adjudicators on panels among the nominating boards which publish their lists are women. This follows on from the Equal Representation in Arbitration Pledge, launched in 2015, which is credited with significantly improving the percentage of female arbitrators sitting on tribunals.

Construction disputes expert Zoe deCourcy Arbiser – appointed chair of the Technology & Construction Solicitors’ Association (TeCSA) this autumn - said: “The adjudication pledge is a fantastic initiative, however it is incumbent upon adjudication nominating bodies to ensure that they are addressing diversity in their panel lists of adjudicators and encouraging those who are underrepresented to apply to join panels. Transparency is critical and those ANBs who are not forthcoming in disclosing the make up of their panels, and what they are doing to address diversity, may well find that they are not selected as the ANB in new contracts going forward as this issue becomes an increasing focus for the industry.”

She added: “This year TeCSA will be focusing on what more it can do to encourage a more diverse range of professionals to become adjudicators, and to support new adjudicators as they develop their skillsets.”

Co-written by Zoe deCourcy Arbiser of Pinsent Masons.