Safetip #24: Evaluate Contractors by Assigning Grades

April 13, 2016
By Jean-Grégoire Manoukian

This week’s Safetip is about contractor safety and the use of a rating system to assign grades to contractors before hiring them. Previous Safetips about contractor safety highlighted the , and the .

World-Class Organizations in EHS Grade Contractors

The National Safety Council’s Campbell Institute released a white paper on best practices of 14 world-class organizations in EHS around the management of contractor and supplier safety. The white paper identifies five major steps of the contractor life cycle. The first step, prequalification, includes three best practices, one of which consists of an internal scale or checklist to assign grades to contractors during prequalification.

A majority of participants (11 out of 14) that took part in the Campbell Institute’s research said they have some form of internal scale, checklist, or metric for which a contractor must receive a “passing grade” to be approved for work. One of the participants assigns a letter grade (A, B, C, or D) based on standard safety statistics, presence of written safety programs, leading indicators and performance evaluation. Another participant assigns grades to contractor applications based on TRIR, responses to a written safety questionnaire and a field audit of written safety programs. Both companies require contractors to hold a grade of A or B to receive a contract, the white paper says.

Other organizations that do not assign grades nevertheless maintain a rating system. For example, Cummins calculates a Contractor Safety Performance Metric that is based on occupational safety and health history, proof of permits and licenses, and documented safety practices and policies, according to the white paper. Another organization rates contractors’ prequalification evaluations as: Satisfactory, Satisfactory with advisory notice, Satisfactory with corrective action plan, or Unsatisfactory. The rating is based on a contractor’s safety statistics, EHS policy, trainings offered, incident reporting, EHS meetings, pre-task planning and inspections.

As part of your program, be sure to consider a grading system to better evaluate contractors, and select the ones with safety records that are in line with your safety standards.