Construction union UCATT has welcomed the news as it has been campaigning against the use of umbrella companies since their wide scale introduction into the construction industry in April 2014.
Payment via an umbrella company costs some workers £100 a week.
In November last year UCATT held a demonstration at the A465 Heads of the Valleys road widening project, which is being built by Carillion and where workers were required to work via umbrella companies.
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Following that protest and pressure from Welsh Assembly Members, Edwina Hart the Minister for Economy, Science and Transport has confirmed that no worker on the A465 will be employed via an umbrella company. They will instead be employed on a standard PAYE basis either by Carillion or its own employment agency Skyblue.
Nick Blundell, UCATT Regional Secretary for Wales and the South West, said: "The use of umbrella companies is unfair and exploitative. The decision of the Welsh Government to crackdown on their use both on the A465 and on all of their contracts is excellent news."
(CD/IT)
