Know Your Contractor: 4 Things to Consider Before Hiring

Know Your Contractor: 4 Things to Consider Before Hiring

Construction work and facility maintenance and repair are almost always performed by contractors or sub-contractors. But what do you really know about who is getting the job done?  There are some factors to consider and investigate when hiring a third-party to do any type of work. This is true when hiring for projects from large vertical construction projects to hiring an electrician to do repair work on a public building.Questions To Ask Before Hiring a Contractor:1) What are their hiring practices?2) Does the contractor have a good safety record?3) Do they require staff to maintain training and certifications?4) Do you know what their EMR (experience modification rate) is?In October 2015 electricians were burned in blast at the Framingham Public Library in Massachusetts when they failed to cut power to the building before they began work on the main electrical panel. The town of Framingham had contracted with a local electrical company whose training practices, OSHA investigators found, were severely lacking.  Those electricians were not trained to recognize job hazards, including not being trained to ensure that the power to building was turned off before beginning work. They were also not provided with proper personal protective equipment. OSHA is proposing fines of $20,300 to the electrical contractor for the violations. Not only were the workers injured in this incident, but the Framingham Library suffered great damage and remains closed five months later.In a large construction project where there are many different subcontractors there is an even greater need to vet who will be working on your project as potential risk increases with the size of the project.Major construction companies like Suffolk Construction will use a prequalification process for its subcontractors, which can be completed online.Suffolk’s prequalification process includes providing a current EMR letter, current bonding letter, financial statements, OSHA 300 log, line of credit verification letter, a list of works-in-progress, and current certificates of insurance.Smaller organizations and municipalities may not have the ability to implement such a comprehensive prequalification system.  So let’s breakdown the four questions from above.Hiring PracticesWhat certifications or qualifications are required before being hired? Minimally an OSHA 10 Construction (or General Industry in manufacturing) is a good place to start. Foreman and those in leadership roles or safety program responsibilities should have a minimum of an OSHA 30 hour.Experience- how much experience does their workforce have? Do they have a high turnover with entry-level employees, or do they have a crew that has been with their company for years? This can make a big difference in how jobs are run. It’s not realistic to think everyone on the job has 15+ years’ experience, but having a solid, long-standing core crew with experienced people in leadership roles is important, especially from a safety standpoint.Not every organization may need to have all of its contractors onsite be able to pass a background check, but in some situations, especially where there is exposure to the public, building security systems, or valuable assets, this is a good idea. If that is something that pertains to your organization, it doesn’t hurt to ask if this is part of your contractor’s hiring process.Safety Record Make sure you ask to see their OSHA 300 log. If they are reluctant to provide you with this, or don’t have one, that should be a red flag. When reviewing the OSHA 300 log, you want to look at frequency of incidents, especially the same type of incident occurring with frequency. For instance, if there are several slip, trip or fall incidents, you can assume that there is a lack of training among workers to identify and reduce this type of job hazard. Allow the contractor to explain incidents that are present on the log, and ask them to show you what the corrective action was.  A contractor that has had a few incidents with slips, trips, and falls but then implements a cohesive safety plan to reduce this type of hazard exposure, and has subsequently trained its entire staff on slips, trips and falls might still be a good hire.TrainingEvery organization should have a safety training program. This may be a combination of in-house trainings and more formalized certifications such as OSHA Outreach courses. In Massachusetts, New York, New Hampshire and Connecticut every worker on a publicly funded construction project is required to hold an OSHA 10 Hour Construction card. Some cities, like New York City require that every worker onsite must have completed the OSHA 10 Hour Construction course within the past 5 years.  It is an employer’s responsibility to ensure that their staff is properly trained. Ask your contractor if they are maintaining records on their employees’ training and certifications, and if they offer training in house, or require certain certifications to be maintained by the employee.Experience Modification Rate (EMR)EMR is an important number in the construction world, but it certainly affects every business that maintains its workers’ compensation insurance policy.  Your EMR is a number used by your insurance company that assesses the cost of past injuries and your future risk. Every business has a different inherent level of risk, for instance a software development firm is going to have a low risk of injury and therefore a lower EMR than an ironworker. In order to know if your contractor has a “good” EMR, it is important to know what is comparable in the industry.In the construction industry, it is common for primary contractors to be asked for their EMR to prequalify for a bid. Here’s a breakdown of what a good EMR looks like for that industry:Typically anything in the 0.70- 0.95 range is deemed as an “acceptable” EMR.  You should very carefully consider any contractor with a 1.0 EMR, and anything above that would be a questionable hire.  Also note that the higher the EMR is, the higher their workers’ compensation rate will be. Those costs are typically handed down to the client in higher bids.With careful consideration of the four factors above, you will be on good footing to select a contractor who will be able to get the job done safely. They may not be the only factors to consider but remember that the lower the risk, the lower the cost will be. Accidents are expensive and have many hidden costs, as the Framingham Public Library has found out the hard way.     

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