The modern workforce is changing and changing fast. Nowadays, most firms – from industry incumbents to plucky startups – employ third-party contractors to perform essential business tasks.
The upside’s been huge. But developing a cooperative, productive, profitable relationship with a contractor takes time, effort, and planning. What’s more, companies not looking to put in the requisite effort have paid a steep price: lost productivity, fines, compromised safety cultures, potentially even jail time for business owners whose contractors flout work health and safety regulations. Looking to avoid the costs of an ineffective contractor relationship program?
First, know the barriers to effective contractor relationship management are real. Though host companies might eventually lower their internal labor costs and improve flexibility with contractors, they have a long way to go to get there. For starters, many contractors will require comprehensive safety onboarding, which requires experienced, dedicated safety staff at the host company.
If you haven’t thought seriously about your existing contractor-safety management competency, launching certain types of contractor engagements might be folly. If you have, though, here are the six steps to take to ensure that those engagements only strengthen your business model, while keeping all parties safe and you liability-free:
- Invest more time in contractor prequalification when making procurement decisions, or work with a qualified third party. Perform more thorough vetting of contractors (especially their safety history) and establish clear performance indicators ahead of time. Also, be as detailed as possible about the scope of work in the contract.
- Have a dedicated team or manager monitor contracted work from tender to post-job evaluation. In addition to ensuring work health and safety compliance, that team or manager should address issues that arise during the contract process, either personally or by engaging a suitably qualified person within the business. The team should also get in the habit of consistently soliciting updates on lagging and leading indicators of contractor performance to identify areas for improvement. The learnings will be important to ensure the safety of future contractors.
- Clearly communicate corporate safety values to contracted workers during mandatory orientation and training(s).
- Go beyond baseline compliance. Mandate your contract employees to pass stringent orientation tests before working on site.
- Maintain proper permitting and certification standards for contract employees in a centralized database.
- Perform frequent job assessments to ensure contract employees continue to meet work health and safety obligations.
Finally, the regulations governing the relationship between host business, contractor agency, and contractor can be difficult to comprehend, especially the duty of care mandate that host businesses and contractor agencies owe to third-party workers. Nor is deciphering those regulations the only contractor relationship management challenge you face. To learn more about the panoply of contractor relationship management issues and how to get the best out of safe contractor engagements, we’ve created a comprehensive guide to contractor relationship management.
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