What Is the Cost of Poor Contractor Management

Four Steps to Take To Avoid the Consequences of Poor Contractor Management

Most companies fail to implement a proper contractor management system because they are not aware of, or underestimate, the consequences of poor contractor management. If an incident were to happen on site, the safety and legal repercussions of hiring non-compliant contractors can devastate a company. Unfortunately, most companies only discover that they have been working with non-compliant contractors when it is too late and they are facing a lawsuit.

The risks associated with poor contractor management processes are real and immense. Still so many companies that work primarily with contractors don’t have a reliable system in place to ensure contractor compliance and to minimize these risks.

Companies hiring contractors must develop a comprehensive system that provides reliable and relevant induction, and which ensures adherence to company and personal compliance before letting contractors work onsite. To avoid learning the consequences of an inadequate contractor management system when it is too late, take action now to have a proper system in place and safeguard against risks. Here are the steps to take:

Step One: Begin with an assessment of the current induction and contractor management system in place. Be sure to take note of its weaknesses and strengths.

Step Two: Next, make a list of the essential components of a proper system. An adequate system should give you the contractor’s company details, ABN information, insurance coverage, Work Cover registration details and HSE information. It should perform the following checks:

  • ABN check: a reliable system should be connected to ASIC so you can find out the registered names of contractors automatically by entering their ABN details alone.
  • Insurance check: go for a program that allows you to enter contractor insurance details, and which alerts you when these expire.
  • Work Cover Registration Check Details: should allow you to upload registration certificates including their expiry dates and alert you when these expire
  • Health Safety and Environment Check: the system should have the ability to develop a questionnaire to help you gauge compliance.

Step Three: Implement an adequate contractor management system with the above capabilities. There are plenty of comprehensive and effective induction systems in the market that will enable you conduct strong and thorough inductions. Start your search for a contractor management system with a Google search to find a system that meets your needs, and which ensures contractor compliance. You can opt for an online system, which is more flexible. Be sure to go for a system that allows you to add and edit your own courses.

You can also inquire what other companies similar to yours use.

Step Four: Subject all existing contractors to the now adequate and proper contractor induction and management system to ensure compliance before allowing them to work on site. Don’t forget to ensure that all the current contractors have met all the requirements.

By taking these steps, you can have peace of mind that your company has taken the necessary measures to reduce the consequences of poor contractor management.