A model for calculating a national all-in-labour rate for the construction industry in the Ghanaian Economy

This study was carried out to develop a comprehensive computerized model for calculating All-in-labour rates for the various tradesmen in the construction industry in Ghana based on the two main existing collective agreement dossiers in use. The target groups were drawn from contractors belonging to classes A1B1 to A3B3 of the Ministry of Roads and Transport and Dl to D2 of the Ministry of Works and Housing. Sample models used by those contractors that have them were collected and examined Factors that have bearing on the determination of All-in-labour rates and contained in the two collective agreement dossiers were also looked at through the use of questionnaire. A total of eighty-seven contractors were assessed and they all indicated that they employ various trades and skill levels but maintained few as permanent staff of the firm. They also concentrated their activities within certain regions for better monitoring and control of resources. Factors that bear on the determination of All-in-labour rates were reported as follows Rainfall component recorded the highest value of 85% (Table 4.2) as factors considered to be time delays and casual leave, maternity leave and paternity leave recording minimum value of 0% (Table 4.2) each. Basic wage and overtime allowance recorded the highest value of 100% (Table 4.3) each as factors observed as direct cost in the determination of the All-in-labour rates and tools allowance a minimum of 76% (Table 4.3). For factors observed as statutory burdens, SSNIT recorded the highest value of 100% and maternity leave, a minimum value of 5% (Table 4.4) Sick leave was the only factor observed as non-productive burden with a value 61 % (Table 4.5). Medical facilities recorded the highest value of 100% (Table 4.6) and paternity leave, a minimum value of 0% (Table 4.6) as factors observed as social burdens. For factors observed as avoidable burdens, transfer allowance recorded the highest value of 41% and underground or underwater the minimum value of 0% (Table 4.7). The observation was that most of the contractors were ignorant about the condition of their own collective agreement dossiers. The two methods that emerged from the survey as means used by the firms in determination of labour costs, were market survey or speculation and use of model. Majority of the firms indicated the use of market survey or speculation, registering a higher value of 83% as against those who indicated the use of model with a value of 17% (Table 4.8). With the market survey or speculation method, different interpretations were assigned to the contents of the constituents of the negotiated lump sum and the additional labour costs to be added on. The use of model expressed by the others was also not comprehensive enough in their computations for determination of the All-in-labour rates. The differences between the two existing collective agreement dossiers in use by the employers of the construction industry were also reviewed. The strengths and weaknesses of the sample models were critically examined and also the possibility of the use of computer in the determination of All-in-labour rates. In light of the findings and examinations of available data, it was possible to develop a comprehensive computerized model for the determination of All-in-labour rates.

Source: KNUST