But while judgment handed down last week favoured the CITB, the case is still live with appeals pending.
The argument comes down to what is a construction company.
The Construction Industry Training Board (CITB) has been in dispute with Hudson Contract Services, now called Knot Builders Limited, for several years, arguing that it should pay the statutory training levy because it employs, or has employed 鈥� employment rules have changed over the course of the battle 鈥� thousands of construction workers.
An employment tribunal ruled in 2018 that Hudson Contract Services was liable to the CITB levy. In March 2020 the Court of Appeal dismissed Hudson鈥檚 appeal but upheld its claim that CITB would have to consider a 拢10.5m grant claim submitted by Hudson in 40 cardboard boxes after a previous court defeat. [See previous report here.]
Thus the legal battle continued.
Hudson Contract Services owner David Jackson set up a new company, Hudson Contract Limited, which began trading on 30th March 2018 鈥榯o enhance compliance with onshore employment intermediaries legislation鈥�.聽 The new company took over the payroll activities formerly conducted by Hudson Contract Services Limited. The 拢1.2bn turnover in Hudson Contract Services鈥� turnover for the financial year 2018 was not there in the following year鈥檚 accounts. Hudson Contract Ltd, meanwhile, has seen its turnover grow from 拢1.2bn to 拢1.5bn over the past five years.
Hudson Contract Services Limited changed its name to Knot Builders Limited (KBL) in November 2020, presumably in an ironic nod to it not being a building company. show no revenue but a 拢7,964,584 liability for its 2015/16 CITB levy and a corresponding outstanding grant claim of 拢8,464,230.
The latest judicial review relating to KBL鈥檚 grant claim was heard in March 2023 and judgment was handed down on 25th January 2024.
KBL claimed entitlement to CITB grants on three grounds. Judge Naomi Ellenbogen dismissed two of them but partially allowed one. She referred to 'fanciful and opportunistic' submissions by KBL, and to the 'cynicism' of certain arguments advanced.
The Construction Industry Training Board issued a statement saying: 鈥淐ITB is the custodian of the construction industry levy and must ensure any funding derived from the levy is available to those employers that qualify. It is therefore vitally important that CITB applies a fair, consistent, and level playing field in the way levy is collected and funding distributed.
"KBL鈥檚 continued attempts to avoid its levy liability and then to claim 拢28m of grant in a claim that has been substantively dismissed has resulted in three years of litigation at the expense of the industry. The funding protected by CITB by this ruling will enable CITB to further invest to support the construction industry to have a skilled, competent and inclusive workforce now and in the future.鈥�
Hudson Contract managing director Ian Anfield retorted: 鈥淜BL's dispute with the ineffective, outdated and incredibly unpopular CITB grant and levy scheme started in 2015 and unfortunately it is not over yet.
鈥淗aving read the CITB press release, if the CITB are so happy with this latest judgement, it begs the question as to why they felt the need to appeal? And as self-proclaimed custodians of levy payer鈥檚 money, why are they throwing money at lawyers and London PR firms instead of focussing on training?
鈥淭he CITB should be far more concerned about what levy payers think about the board鈥檚 failure to have any meaningful impact on skills, and far less interested in publicising and perpetuating their disputes with KBL.鈥�
He added: 鈥淭he facts of the case are that KBL is not liable to pay levy until a grant offset is finalised. That offset could range from zero to near 拢30m depending on lots of factors. KBL has always been clear that its desired outcome would be cost neutral.
鈥淜BL was successful on one of three grounds, and CITB had already agreed KBL may be entitled to other grants that had not been disputed. Those grants are yet to be quantified but the final difference between grant and levy will take some time to agree, with appeals it could be 18 months or longer.
鈥淯ltimately KBL should never have been dragged into levy and it should not have had to go to court to be given access to the grant scheme.鈥�
The full judgment can be found at
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