A Freedom of Information request made by Unite to the HMRC revealed that 1,12 million construction workers were paid via the Construction Industry Scheme (CIS) in 2017/18. A 4% increase on the figures for 2016/17.

According to Unite, while workers are classified as self-employed, because they are taxed at source and the nature of their engagement, the “vast majority” are bogusly self-employed.

It said: “In 2014 the government introduced measures designed to crack down on bogus self-employment in the construction industry, by barring construction workers operating via engagers (employment agencies and payroll companies) from being self-employed.

“The continuing year on year increase in the number of workers operating via the CIS scheme demonstrates that the government’s crackdown on bogus self-employment has failed. Since 2014 there has been an 18 per cent increase in workers operating via CIS.”

In total 49% of the industry’s 2.29 million workers were paid via CIS in 2017/18.

Unite said that the bogus self-employed are denied even the most basic employment rights such as holiday pay and can be dismissed at a moment’s notice without warning.

Assistant general secretary, Gail Cartmail, said: “These latest figures are a damming indictment of the failure of the government to deal with rampant bogus self-employment in construction.

“Bogus self-employment is costing the exchequer millions in lost revenues and amounts to a huge hidden subsidy to construction employers.

“The government has clearly lost control of tackling bogus self-employment in construction, resulting in the routine exploitation of workers.

“The entire system needs to be radically reformed so that workers are either genuinely self-employed or paid via a standard PAYE format.”