London Olympic projects could be hit by widespread industrial action and wildcat strikes because the Olympic Delivery Authority has refused to set a single pay structure, Ucatt, the building union, has given warning.

The union says that resentment among workers who are being paid less than those on different projects is likely to trigger strike calls. It claims that one of the reasons the new Wembley Stadium was hit by disruption and delays was that subcontractors paid differing rates. However the building of Terminal Five at Heathrow Airport was more successful because a single rate was agreed.

Alan Ritchie, the Ucatt general secretary, said: “My union is 100 per cent committed to the London Games being a total success. However, I fear that the ODA’s refusal to agree a common site rate is a recipe for industrial disharmony, delays and cost overruns. It is not too late for these problems to be revisited and resolved.”

The ODA said that it would not go further than an outline agreement with the unions covering work on the site. A spokesperson said: “The ODA is committed to good employment standards. We have agreed a positive partnership with construction unions under a Memorandum of Agreement which includes contractors recognising existing construction and allied industries National Working Rule Agreements and pay rates. These are set periodically by a joint employer and union body at a national rather than workplace level.”

Work on building the main Olympic stadium and other projects is due to begin in the spring. At the peak of the construction work in 2010-11 there will be 10,000 building workers at the main site in Stratford, East London.

It is expected that the Olympic building will be undertaken by between 25 and 40 major contractors and many more subcontractors.

A spokesman for Ucatt said: “Workers will have the option to either switch between contractors in search of better rates of pay, or down tools and walk off site in protest. Both courses of action will create instability and delays. The only way to resolve the problem will be to increase the work-force or for them to work longer. This will then increase costs.”

Ucatt successfully campaigned for all workers on the Olympics to be directly employed by contractors rather than work on a self-employed basis, as is common in the building industry. The union has waged a battle against what it sees as “bogus self-employment” which it sees as restricting workers’ rights and as a tax loss. It has said that if the practice of self-employment in construction was ended, the Exchequer would save enough to pay for the Olympics.

The Olympics development and the regeneration of Stratford, which will be carried out at the same time, is one of the biggest building projects undertaken in Britain. The work will require carpenters, bricklayers, roofers, plasterers, fork-lift truck drivers, plumbers, electricians, crane drivers, tunnellers, locksmiths, scaffolders, gas fitters, JCB drivers, banksmen, welders, and road gangs. The building projects include the stadium, aquatic centre, velopark, hockey centre and four multisport arenas for fencing, volleyball, basketball and handball.

The ODA is working with CLM, a consortium established to help to keep the building costs under control. In spite of that the Government has given warning that there is a 20 per cent chance that the £9.3 billion total budget will be exceeded.

Down tools

Will the Olympic dream go up in smoke?

10,000 The estimated number of building workers on Olympic projects by 2010
25-40 The number of major contractors employed on Olympic projects
£9.3bn Olympic budget
20% Government estimate of the chances that the budget will be exceeded

Projects include
— The stadium
— The aquatic centre
— The velopark
— The hockey centre
— Four multisport arenas for fencing, volleyball, basketball and handball

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive