Page 62 - OHS, June 2024

CONSTRUCTION SAFETY
3 Ways to Manage Third-Party Risk in Construction
Hiring third parties in construction can pose risks in construction, but with a clear strategy in place, those risks can be managed.
BY TAYLOR THORN
Third-party contractors are a common way to distribute con- struction labor and leverage specialized expertise. Most res- idential projects involve an average of 24 subcontractors,1 and there are often more on the commercial side.
But as OSHA rules state,2 any time you hire a third party in construction, you assume responsibility for their actions on a job site. And without the right processes in place, these third parties can pose an enormous risk to your operation. If someone lacks the right safety training for instance, you could be liable for any inju- ries that occur on site – along with any regulatory fines that result.
In order to manage third-party risk, it helps to have a clear strategy. Here, I’ll share three best practices that can help.
1. Centrally Organize Documents
You need specific documents on file for every third-party contrac- tor. At a minimum, this typically includes a:
■ Subcontractor contract agreement
■ Certificate of insurance (COI)
■ Certificate of bond
These documents can quickly become tough to manage,
though, especially as you expand your team. And if a third-party worker gets injured on site, the last thing you want to do is to comb through physical and digital folders to find their insurance infor- mation.
That’s why it’s important to have a system – ideally digital – for organizing and filing documents. Make sure:
■ Create a document checklist. The right software should let you customize this checklist for various types of third parties (e.g., one for electricians, another for carpenters, etc.).
■ Clearly label each document. A standardized naming sys- tem makes it easier to find docs when you need them.
■ Centralize your document storage. Cloud-based software is helpful here; it lets you access your files from anywhere, whether you’re at the office or on a job site.
With a solid system in place, you can more efficiently manage third-party documentation. And if an incident or audit occurs, you can quickly locate any files you need.
2. Clarify and Communicate Safety Requirements
While many general contractors (GCs) have similar safety require-
60 Occupational Health & Safety | JUNE 2024
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