Our latest Safetip is about assigning risk ratings for contract work projects to be performed, and placing contractors in risk categories.
More Contractors Equals More Risks
The use of contractors and subcontractors has been rising steadily over the years.
According to a 2017 survey by ISN Analytics, almost 50% of hiring organizations reported using contractors to complete between 40% and 100% of their on-site work.
The same survey shows that about 45% of hiring organizations use more than 500 contractor companies across the enterprise.
The growing use of contractors creates risks because in many cases companies have partial or full responsibility for the safety of contractors on their sites. Also, the safety performance of contractors can impact their own safety performance and thus their reputation.
Categorize Contractors by Risk Level
A white paper by the National Safety Council’s Campbell Institute identifies Best Practices in Contractor Management. One of them consists of assigning risk ratings for work to be performed by contractors.
Two-thirds of research participants (9/14) reported having a method to evaluate the risk of the work to be performed, in order to put contractors in predetermined risk categories.
Examples of practices used by research participants include:
- Performing an initial risk assessment based on the broad scope of work, and a second assessment based on the contractor’s detailed work procedure.
- Calculating the risk associated with a given project by assigning ratings for incident severity, frequency and likelihood.
- Requesting additional written safety programs for projects with higher risk ratings.
- Evaluating contractors with a risk matrix by assessing incident likelihood, severity, cost, schedule, security and other factors.
- Requiring an in-depth risk assessment for large capital projects, and requesting additional actions from contractors based on the assessments. In some instances, different methods for completing the job may be explored.
- Assessing risk in terms of insurance liability and the type of work.
- Assigning a “prequalification action level” based on the risk level of the work, and requiring prequalification through a third party if a project is deemed to have a high prequalification action level.
By evaluating the risk level of the work to be performed, you can make more informed decisions about the selection of contractors, and determine if extra safety measures and precautions should be taken.
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