Managing Contractor Risks
Write good contracts
A risk-reduction program for contractors and subcontractors must begin with a company policy that mandates protection for all personnel that enter the site, regardless of their status as employees, contractors, or visitors. Written contracts or purchase orders must be used to set forth the safety, health, and compliance duties of contractors and subcontractors. The common practice of telephoning contractors, requesting work, and permitting site entry and job performance, without documentation, must be eliminated to establish an effective risk-reduction program.
To overcome administrative burdens and delays in time-sensitive situations, local, routine, and long-term relationships can be memorialized once in a written contract and all future work can be performed according to the terms of that contract, by the use of a written purchase order or work order that refers to the contract. As is customary, the documents should require compliance with “all laws and regulations,” but also should include specific, critical safety and health mandates like training, work place hazard inspections, and personal protective equipment (PPE). The contract and purchase order documents can reference more extensive safety and health programs and rules and require compliance with them, including the use of site safety and health “checklists” or “forms” that document compliance.
Stickler’s admonition, essentially to use contractors and subcontractors with good safety records, is excellent, but not achievable using only the MSHA Web site data (which may report nothing for most small subcontractors and no prior incidents for many others). Whenever possible, contractor selection should include consideration of the company’s expertise and workers’ compensation history and ratings — far better tools for safety and health risk comparisons than the government Web sites. Moreover, “indemnification and defense” contract provisions, as well as specific and adequate insurance coverage contract mandates, and the production of proof of insurance, are critical risk-management tools.
Keep it simple
Contractor risk-reduction programs must be easy to implement in order to be effective, particularly at small operations and job sites. The programs should be designed to be implemented by either hourly personnel or management, with minimal additional training, using predetermined forms and checklists of critical items applicable to the site and expected jobs (e.g. insurance certification, training documents, fall protection, lockout/tag out, and PPE).
Site access should be restricted, controlled, and documented to the greatest extent possible to help implement a risk-reduction program. Site entry should be combined with, and dependent upon hazard warnings, site rules, training documentation, and accompaniment by site personnel, to the fullest extent possible.
The effectiveness of a contractor risk-reduction program can be measured by its application and enforcement, and its failure can be measured by its tolerated breach, generally long before an accident ever takes place. Contractors and subcontractors must be monitored for safety and health contract compliance, just like they are for job performance. Documented enforcement of contracts, including suspension and termination, should be the means for addressing contractor and subcontractor safety and health failures. “Form” warning notices and letters, as well as management training, can make this difficult task easier for site personnel charged with implementing risk-reduction programs.
Customize your program
Identifying site-specific, high-risk jobs and the most likely potential enforcement actions can help tailor a contractor risk-reduction program. Stickler and MSHA, like OSHA, provide help by identifying the leading causes of violations and accident-related enforcement actions. In the same May 1 speech, Stickler stated: “During the last five years, failure to block equipment has been one of the two most-often cited standards following a fatality at metal/non-metal operations.
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