Skanska USA terminates Atlantic Yards construction management contract
Skanska USA Building has terminated its Construction Management and Fabrication Services Agreement for the Atlantic Yards B2 Residential Project with Forest City Ratner affiliate, the Atlantic Yards B2 Owner.
Construction Global reported last month that Skanska had halted work at the site as well as its prefabrication hub on the contract worth $117m.
Skanska said it notified the B2 Owner on August 8 of its intent to terminate if the B2 Owner did not address its many material breaches under the agreement, and that the August notice was issued after a series of unsuccessful efforts by Skanska throughout 2014 to resolve the significant commercial and design issues facing the B2 project.
The company said that consistent with its behaviour, the B2 Owner again took no action to remedy its breaches, leaving Skanska no choice but to terminate the agreement and pursue its rights to be paid for the millions of dollars in extra costs it has incurred to keep the project going and its modular factory workers working.
Commenting on the situation, Skanska USA Building Co-Chief Operating Officer Richard Kennedy said: “Today is an incredibly disappointing day. Our company has a long history of working with our clients through all kinds of challenges so, at the end of the day, we deliver the best product possible to our clients and the communities in which we live and work. In New York alone, we have worked on some of the city’s most iconic structures and with each of those projects, we have finished the job. While the B2 project certainly has its issues, we were hopeful that our client and partner would address them so we could move forward with building much-needed affordable housing in Brooklyn.
“But we could not continue to incur millions of dollars in extra costs with little hope that Forest City would take responsibility for fixing the significant commercial and design issues on the project. We pride ourselves on being an innovative company and we will continue to build using prefab and modular techniques to move the construction industry forward. This issue will not deter us from continuing on that journey of innovation.”
Comment from the B2 owner was not available at the time of writing.
The construction industry: Facing a mental health crisis
Data collected by the Office for National Statistics has shown that more than 2,000 construction workers took their own lives in 2017. Other findings from a study conducted by the Glasgow Caledonian University show that the problem is getting worse. From 2017 to 2019, the number of suicides per 100,000 rose from 26 to 29, with people in the construction industry three times more likely to take their own lives in 2019 compared to other industries.
Why is the construction industry experiencing a rise in mental health conditions?
Bill Hill, Chief Executive of the mental health charity Lighthouse Club, says that one reason for the rise in mental health conditions is due to financial pressure. He said that it is a “huge factor” in construction, “causing stress, depression, and anxiety”. He added that several self-employed workers are “brilliant tradespeople but don’t have the education”, which may be helpful in running their business.
“They win a project, someone pays them a big invoice but they don’t put money aside for VAT [and then] the taxman asks for payment so they get finance. It tumbles from there. Sole trader-style business management should be taught at apprenticeship level”, Hill said.
According to Lighthouse Club, the industry is “hugely fragmented” and “difficult to reach over half of the 2.8mn self-employed construction workers. “Some larger companies have done a fantastic job on mental health”, Hill says. “But only apply their programmes and workshops to their own staff. Until you get to the huge mass of very capable tradespeople who are getting no input, one of the biggest problems is awareness”.
How can awareness of mental health be improved in the construction industry?
Chief Executive of the Construction Industry Council, Graham Watts, says that the industry has made positive steps forward on mental wellbeing but that “it is still not doing nearly enough” to support staff in this area.
Looking at how awareness of mental health can be improved in the industry today, Watts said: “Today, I would hope it is easier to be more open about mental health. I’m impressed by the leadership that is being shown by some companies – for example, Tideway, where Chief Executive Andy Mitchell has ‘mental health first aider’ immediately after his email sign-off – but it is still only being exhibited by the best of the best”.
Lighthouse club has also launched a campaign for construction workers to raise more awareness of mental health in the industry. Named “Help Inside the Hard Hat”, the campaign makes all workers aware of the services that Lighthouse Club offers, “regardless of employment status”, the charity says. Lighthouse Club is taking particular care to encourage contractors to put up posters on sites and ensure that they reach all workers, including the self-employed.
The charity also has a free app that allows workers to access mental health information and resources. Lighthouse Club is also improving the availability of information by working with partners such as the Safer Highways charity and Glasgow Caledonian University. But the charity is working on improving the understanding and destigmatisation of mental health in the industry one step at a time. Hill said: “The first thing is suicides,” says Hill. “That is the number one benchmark of all the work we are doing – are we reducing suicides in the industry?”.
If you are a construction worker - or someone you know is and you need support, you can call the Lighthouse Club helpline on 0345 605 1956.