Managing Contractors and Sub-Contractors Law and Good Practice

1. Managing Contractors and Sub-ContractorsLaw and Good Practice 18 March 2019 Sarah Valentine Senior Associate, EHS Eversheds Sutherland | LHSG 18 March 2019

2. Contractor Management Themes Identifying who contractors are ‘Catching’ contractors at the start of a relationship Providing supervision, without a constant presence Imparting our standards on to their people Responding to health and safety concerns Long term contractors and wellbeing Eversheds Sutherland | LHSG 18 March 2019

3. Why is it important to manage Contractors? What could possibly go wrong? https://www.youtube.com/watch?v=3JQ73iTePOQ https://www.youtube.com/watch?v=BFACDPJ3mIM

4. All about you • How successful is your organisation at managing contractors? Eversheds Sutherland | LHSG 18 March 2019

5. Contractor Engagement Process Step 1: Plan Step 2: Select Step 3: Prepare Step 4: Review Step 5: Reflect Eversheds Sutherland | LHSG 18 March 2019

6. Regulatory Requirements Responsibilities Eversheds Sutherland | LHSG 18 March 2019

7. Responsibilities Legal Duty – Section 3 HSWA Employer’s basic duty: “conduct his undertaking in such a way as to ensure, so far as is reasonably practicable, that persons not in his employment who may be affected thereby are not thereby exposed to risks to their health or safety.” A different duty to Section 2 HSWA? Eversheds Sutherland | LHSG 18 March 2019

8. Responsibilities Regulatory Requirements Management of Health and Safety at Work Regulations 1999: • Risk Assessment obligation – Regulation 3 • Co-operation and co-ordination when sharing a workplace – Regulation 11 • Providing information about workplace risks – Regulation 12 Eversheds Sutherland | LHSG 18 March 2019

9. Responsibilities Regulatory Requirements Construction (Design and Management) Regulations 2015 are more specific: “must have the skills, knowledge and experience, and, if they are an organisation, the organisational capability, necessary to fulfil the role that they are appointed to undertake, in a manner that secures the health and safety of any person affected by the project.” Eversheds Sutherland | LHSG 18 March 2019

10. Responsibilities Regulatory Requirements Organisation Capability: • Policies and systems to set acceptable health and safety standards • Resources and people to deliver the standards “Only enquiries for information that will address the anticipated risks and capability of the supplier should be made – excessive or duplicated paperwork should be avoided because it can distract attention from the practical management of risks.” Eversheds Sutherland | LHSG 18 March 2019

11. Responsibilities What is not your responsibility? Health surveillance Provision of: • periodic training • personal protective equipment • work equipment Consultation Eversheds Sutherland | LHSG 18 March 2019

12. Responsibilities What is not your responsibility? Be wary of seeking to enforce policy promises on contractor employees: “This policy is a mandatory requirement and shall apply to all employees, agency workers and contractors without exception” Eversheds Sutherland | LHSG 18 March 2019

13. Responsibilities Who is a contractor? “Anyone who is brought in to work for your company, but who is not an employee” Is this definition consistently applied? It’s not about cost or time Can a two-tier system be used, based on risk? Eversheds Sutherland | LHSG 18 March 2019

14. Responsibilities Long Term/Preferred Contractors Beware of contractors that are ‘part of the family’ Properly treated as third parties? Examples include: • Security • Caterers • Cleaning • Facilities Eversheds Sutherland | LHSG 18 March 2019

15. Responsibilities In-House Contractors Employee of Tesco Maintenance Limited fell 30 feet through a skylight, suffering minor injuries No risk assessment or method statement for work Tesco Maintenance Limited • Reg 9 of Work at Height Regulations, Sections 2 and 3 HSWA • £300,000 fine Tesco Stores Limited • Section 3 HSWA and Reg 10 of CDM • £200,000 fine Eversheds Sutherland | LHSG 18 March 2019

16. Responsibilities Imbalance in power Contractors who are ‘eager to please’ How do you manage the risk of ‘job creep’? The difference between advising and mandating – Marks and Spencer and Willmott Dixon Eversheds Sutherland | LHSG 18 March 2019

17. Responsibilities Calculating Competence What does competency look like? • Difference between an operator and a supervisor • Checking management competence • Skills, experience and qualifications • Health and safety policy • Check accident/enforcement record • Insurance • Contractors own audit process • References How can checks be recorded, and what documentation should be retained? When should it be reviewed? Eversheds Sutherland | LHSG 18 March 2019

18. Managing those you don’t employ Challenges Eversheds Sutherland | LHSG 18 March 2019

19. Managing those you don’t employ Policy Communicating the policy internally and externally • Sending documentation in advance • Summarising for the purpose of induction • Different roles and responsibilities Targeting the right people with the right instructions Eversheds Sutherland | LHSG 18 March 2019

20. Managing those you don’t employ Induction Differing levels for differing risk Achieving best delivery: • face to face • online • video • reading When to update/refresh Eversheds Sutherland | LHSG 18 March 2019

21. Managing those you don’t employ Discipline, complaints and grievances How do contractor employees have access to their line manager/supervisor when on your site? Do they report ‘near misses’ to you? Are they part of your consultation arrangements? Avoiding going too far Adopting a joint approach Eversheds Sutherland | LHSG 18 March 2019

22. Construction (Design and Management) Regulations 2015 Eversheds Sutherland | LHSG 18 March 2019

23. Key CDM Objectives Right people / Right time Apply proper principles of prevention Provide information, instruction and supervision Ensure co-operation, co-ordination and communication Consult and engage with the workforce Eversheds Sutherland | LHSG 18 March 2019

24. What is construction work? “Construction work” means the carrying out of any: • building; • civil engineering; or • engineering construction work. Includes (in relation to a structure): • alteration • conversion • renovation • upkeep • redecoration Eversheds Sutherland | LHSG 18 March 2019

25. The detail… Eversheds Sutherland | LHSG 18 March 2019

26. Who is the Client? An organisation or individual for whom a construction project is carried out Those for whom a construction project is carried out in connection with a business, whether the business operates for profit or not. Eversheds Sutherland | LHSG 18 March 2019

27. Client - Overview of responsibilities Make suitable arrangements for managing the project Set out functions, roles and responsibilities of the project team Allocate sufficient time and resources to complete the project Ensure effective communication and co-operation Review and ensure compliance with duties Provide welfare facilities for workers Eversheds Sutherland | LHSG 18 March 2019

28. Triggers for notification When to inform the HSE? • more than 30 days and more than 20 workers working simultaneously on the project; or • exceed 500 person days • Whose responsibility? Eversheds Sutherland | LHSG 18 March 2019

29. Preferred contractors Site specific list of contractors that have performed acceptably on previous work Acts as a starting point; not definitive and a full assessment still required Important that list is kept up to date – needs your input Eversheds Sutherland | LHSG 18 March 2019

30. How often to check? Depends on: risk from activity length/complexity of task any current concerns about the contractor Who is appropriate to evaluate the contractor? Record the checks? Feedback? Other considerations Eversheds Sutherland | LHSG 18 March 2019

31. Who is a Designer? • Those, who, as part of a business, prepare or modify designs (or instruct others to do so) for a construction project. • ‘Design’ includes drawings, design details, specifications, bills of quantity and calculations prepared for design. Eversheds Sutherland | LHSG 18 March 2019

32. Designer - Overview of responsibilities • Duties apply as soon as designs are prepared which may be used in construction works in Great Britain • Make sure Client is aware of its duties • When preparing or modifying designs, the Designer should seek to eliminate risks as far as possible and reduce or control them where elimination is not possible Eversheds Sutherland | LHSG 18 March 2019

33. Who is a Contractor? Those who (in the course or furtherance of business) carry out, control or manage the actual construction work and can be either an individual or a company Includes those who use their own workforce to do construction work on their own premises Eversheds Sutherland | LHSG 18 March 2019

34. Contractor - Overview of responsibilities Plan, manage and monitor construction work under their control to ensure that it is carried out without risks to health and safety Where there is more than one Contractor, co-ordinate with the projects team and comply with directions coming from the Principal Contractor and Principal Designer Where there is one contractor, the Contractor must prepare a construction phase plan Eversheds Sutherland | LHSG 18 March 2019

35. Who is a Worker? People who work for or under the control of Contractors on a construction site Eversheds Sutherland | LHSG 18 March 2019

36. Key issues when considering Workers • They must: • be consulted about matters affecting their health, safety and welfare • take care of their own health and safety and others who may be affected by their actions • report anything they see which is likely to endanger themselves or others • co-operate with their employer, colleagues, Contractors and other duty holders Eversheds Sutherland | LHSG 18 March 2019

37. Multiple Contractors on site Eversheds Sutherland | LHSG 18 March 2019

38. Who is the Principal Designer? Principal Designer appointed by the Client in projects involving more than one Contractor Can include an organisation or an individual with sufficient knowledge, experience and ability to carry out the role Must be appointed in writing by the Client Eversheds Sutherland | LHSG 18 March 2019

39. Principal Designer - Overview of responsibilities Plan, manage, monitor and co-ordinate health and safety in the pre-construction phase of a project Prepare and provide relevant information to other dutyholders Liaise with the Principal Contractor to help in the planning, management, monitoring and coordination of the construction phase Eversheds Sutherland | LHSG 18 March 2019

40. Who is the Principal Contractor? Contractor appointed by the Client to co-ordinate the construction phase of a project where it involves more than one contractor Must possess the skills, knowledge and experience and the organisational capability necessary to carry out its role effectively given the scale and complexity of the project and risks involved Must be appointed in writing by the Client Eversheds Sutherland | LHSG 18 March 2019

41. Principal Contractor - Overview of responsibilities • Plan, manage, monitor and coordinate the construction phase of a project • Ensure • suitable site inductions are provided • reasonable steps are taken to prevent unauthorised access • workers are consulted and engaged in securing their health and safety • welfare facilities are provided Eversheds Sutherland | LHSG 18 March 2019

42. Recent Case Law Lessons Eversheds Sutherland | LHSG 18 March 2019

43. Health and Safety Sentencing • Company penalties • Size of the company in terms of turnover (potential liability of parent or other group companies) • Culpability • Harm • Aggravating & mitigating factors • Individual penalties • Fine • Imprisonment • Also consider disqualification Eversheds Sutherland | LHSG 18 March 2019

44. Sentencing Council Health and Safety Sentencing Eversheds Sutherland | LHSG 18 March 2019

45. Health and Safety Sentencing • Tariff for health and safety fines based on ‘culpability’ and ‘harm’ Eversheds Sutherland | LHSG 18 March 2019

46. Sentencing Guideline General Concepts • Seven figure fines are the norm for health and safety prosecutions of large/very large organisations • HSE Statistics: Eversheds Sutherland |LHSG 18 March 2019

47. Recent Case Law – Lessons Workplace Separation - Whirlpool Contractor installing fire detection equipment Whirlpool employees started conveyor unaware of contractor No system to prevent conflicting work tasks taking place Fine - £700,000 Breach – Section 3 HSWA Eversheds Sutherland | LHSG 18 March 2019

48. Recent Case Law – Lessons Managing subcontractors - Trenchco Limited and Grangewood Builders Principal Contractor (Grangewood Builders) appointed Trenchco to carry out specialist demolition work as part of a £5million refurbishment scheme Employee fell through fragile roof pane, suffering a severed spine as a result Trenchco supervisor directly controlling the work had no formal training relating to supervision and some of the workers, including the Romanian victim, had to rely on unofficial interpreters to pass on instructions and tell them what the health & safety records contained Eversheds Sutherland | LHSG 18 March 2019

49. Recent Case Law – Lessons Competent contractor – Ernest Doe & Sons, Balsham (Buildings) Limited and Strong Clad Ltd Dengie Crops Limited - Client Ernest Doe & Sons – Principal Contractor with no experience in construction Subcontracted work to Balsham (Buildings) Limited Subcontracted work to Strong Clad Ltd Principal Contractor and two sub contractors prosecuted Eversheds Sutherland | LHSG 18 March 2019

50. Supervision, monitoring and control How much is too much? Eversheds Sutherland | LHSG 18 March 2019