Contracting to meet the Health and Safety in Employment Act 1992 -- draft guidance for principals
Appendices
Appendix 1: Glossary
The following key terms are defined in section 2 of the Health and Safety in Employment Act 1992, or where indicated, in the Health and Safety in Employment Regulations 1995. The definitions are reproduced here, sometimes in paraphrase, with commentary in italics where applicable.
Accident means an event that
- causes any person to be harmed, or
- in different circumstances, might have caused any person to be harmed.
The Act prescribes investigation, hazard management and reporting duties after an accident. It should be noted the definition in terms of the Act is broader than in common usage and includes "near misses" as well as events causing injury or illness.
All practicable steps: in relation to achieving any result in any circumstances, means all steps to achieve the result it is reasonably practicable to take in the circumstances, having regard to the:
- nature and severity of the harm that may be suffered if the result is not achieved
- current state of knowledge about the likelihood that such harm of that nature and severity will be suffered if the result is not achieved
- current state of knowledge about the harm of that nature
- current state of knowledge about the means available to achieve the result, and about the likely efficacy of each
- availability and cost of each of those means.
A person required to take all practicable steps under the Act is required to take those steps only in respect of circumstances that the person knows, or ought reasonably to know, about.
This important term is discussed at 1.3, The extent of the duty, above.
At work: in relation to any person, means present, for gain or reward, in the person's place of work.
The definition depends on that for "place of work". It also raises the question of timing as to when a person is in their place of work, but not necessarily for gain or reward. Is for example an employee "at work" during their unpaid lunch break? The courts are likely to say yes if the purpose of their coming to work was for gain or reward, and their shift is continuing after the break. On the other hand a visit to a place of work for private purposes, and after the hours of work, is less likely to be construed as "at work".
Construction work is defined by Regulation 2 as:
- any work in connection with the alteration, cleaning,
construction, demolition, dismantling, erection, installation, maintenance,
painting, removal, renewal, or repair, of -
- any building, chimney, edifice, erection, fence, structure, or wall, whether constructed wholly above or below, or partly above and partly below, ground level
- any aerodrome, cableway, canal, harbour works, motorway, railway, road, or tramway
- any thing having the purpose of drainage, flood control, irrigation, or river control
- any distribution system or network having the purpose of carrying electricity, gas, telecommunications, or water
- any aqueduct, bridge, culvert, dam, earthwork, pipeline, reclamation, reservoir, or viaduct
- any scaffolding, and
- includes any work in connection with any excavation, preparatory work, or site preparation carried out for the purposes of any work referred to in paragraph (a) of this definition; and
- includes any work referred to in paragraph (a) or paragraph (b) of this definition carried out underwater, including work on buoys, obstructions to navigation, rafts, ships, and wrecks; and
- includes the use of any materials or plant for the purposes of any work referred to in any of paragraphs (a) to (c) of this definition, and
- includes any inspection or other work carried out for the purposes of ascertaining whether any work referred to in any of paragraphs (a) to (c) of this definition should be carried out; but
- does not include any work in any mine, quarry, or tunnel.
Contractor: a person engaged by any person (otherwise than as an employee) to do any work for gain or reward.
Employee: primarily a person employed by any other person to do any work (other than residential work) for hire or reward; and, in relation to any employer, means an employee of the employer.
There are some exceptions where, for example, volunteers, persons involved in job training or work experience, or loaned employees, are deemed to be employees for purposes of the Act.
Employer: primarily someone who or that employs any other person to do any work for hire or reward; and in relation to any employee, means an employer of the employee.
Again, there are some exceptions where, for example, volunteers, persons involved in job training or work experience, or loaned employees, are deemed to be employees for purposes of the Act.
Facility: includes amenity and equipment.
This definition is particularly relevant to the application of regulations made under the Act concerning the provision of facilities.
Fail: includes refuse; "failure" includes refusal.
Harm: illness, injury, or both and includes physical or mental harm caused by work-related stress; "to harm", "harmed" and "unharmed" have corresponding meanings.
See also, "serious harm", below.
Hazard: an activity, arrangement, circumstance, event, occurrence, phenomenon, process, situation, or substance (whether arising or caused within or outside a place of work) that is an actual or potential cause or source of harm; and includes (i) a situation where a person's behaviour may be an actual or potential cause or source of harm to the person or another person and (ii) without limitation, a situation where a person's behaviour results from physical or mental fatigue, drugs, alcohol, traumatic shock, or another temporary condition that affects a person's behaviour.
"Hazardous" has a corresponding meaning.
Home: means a place occupied as a dwelling house; and includes any garden, yard, garage, outhouse, or other appurtenance, of a home.
This definition is used in conjunction with that for "residential work". See also 1.4, Coverage is broad.
Machinery: means an engine, motor, or other appliance that provides mechanical energy derived from compressed air, the combustion of fuel, electricity, gas, gaseous products, steam, water, wind, or any other source; and includes -
- any plant by or to which the motion of any machinery is transmitted
- a lifting machine, a lifting vehicle, a machine whose motive power is wholly or partly generated by the human body, and a tractor.
This definition is particularly relevant to the application of regulations made under the Act and concerning machinery.
Notifiable work: is defined by Regulation 2 of the Health and Safety in Employment Regulations 1995 as:
- any restricted work, as that term is defined in regulation 2 (1) of the Asbestos Regulations 1999
- any logging operation or tree-felling operation, being an operation that is undertaken for commercial purposes
- any construction work of one or more of the following kinds:
- work in which a risk arises that any person may fall 5
metres or more, other than work in connection with a residential building up to
and including 2 full storeys
work on overhead telecommunications lines and overhead electric power lines
work carried out from a ladder only
maintenance and repair work of a minor or routine nature; - the erection or dismantling of scaffolding from which any person may fall 5 metres or more
- work using a lifting appliance where the appliance has to lift a mass of 500 kilograms or more a vertical distance of 5 metres or more, other than work using an excavator, a fork-lift, or a self-propelled mobile crane
- work in any pit, shaft, trench, or other excavation in which any person is required to work in a space more than 1.5 metres deep and having a depth greater than the horizontal width at the top
- work in any drive, excavation, or heading in which any person is required to work with a ground cover overhead
- work in any excavation in which any face has a vertical height of more than 5 metres and an average slope steeper than a ratio of 1 horizontal to 2 vertical
- work in which any explosive is used or in which any explosive is kept on the site for the
- purpose of being used
- work in which any person breathes air that is or has been compressed or a respiratory medium other than air.
Notification of hazardous work is defined by Regulation 26, which requires that:
- Every employer who intends to commence any notifiable work or any work that will at any time include any notifiable work shall take all practicable steps to lodge notice of that intention in accordance with this regulation
- A notice required to be so lodged regulation
must:
be lodged at an office that deals with occupational safety and health matters, being the nearest such office of the Department to the place where the work is to be carried out
be in writing
be given at least 24 hours before the time at which the employer intends to commence the work
and contain the following particulars:- the nature and location of the work
- the name, address, and contact details of the employer
- the intended date of commencement of the work
- the estimated duration of the work.
- It is not necessary for any employer to lodge notice
before commencing any construction work or tree felling operation necessary to
deal with an emergency arising from:
- damage caused by any earthquake, explosion, fire, flood, lightning, ram, slip, storm, or washout; or
- the blockage or breakdown of any drain or sewer
- the blockage or breakdown of any distribution system or network for electricity, gas, telecommunications, or water.
The duty to notify extends to "employers", but "employer" is then broadly defined as any person who controls a place of work and so includes principals who control places of work.
Person: includes the Crown.
Person who controls a place of work: in relation to a place of work, means a person who is the:
- owner, lessee, sublessee, occupier, or person in possession, of the place or any part of it
- owner, lessee, sublessee, or bailee, of any plant in the place.
Place of work: a place (whether or not within or forming part of a building, structure, or vehicle) where a person is to work, is working, for the time being works, or customarily works, for gain or reward; and
In relation to an employee, includes a place, or part of a place, under the control of the employer (not being domestic accommodation provided for the employee), -
- Where the employee comes or may come to eat, rest, or get first-aid or pay; or
- Where the employee comes or may come as part of the employee's duties to report in or out, get instructions, or deliver goods or vehicles; or
- Through which the employee may or must pass to reach a place of work.
Further, a person is defined as being in a place of work whenever and wherever the person performs work, including in a place that the person moves through or a place that itself moves.
It is clear from the definition of a place of work that it is not confined to fixed sites where people work but extends also to places where employees are "on the move" while working (for example, trucks and boats) or places through which employees must pass for work-related purposes (for example, bridges, passages, and other access points).
Plant: includes -
(a) an appliance, equipment, fitting, furniture, implement, machine, machinery, tool, and vehicle
(b) part of any plant, the controls of any plant, and any thing connected to any plant.
Because it begins with the word "includes", this definition supplements the everyday meaning of the word `plant', and does not limit its terms.
Principal: a person who or that engages any person (otherwise than as an employee) to do any work for gain or reward.
This describes a contract for services under which the person performing the work is self-employed.
Residential work: in relation to the occupier of a home, means -
- domestic work done or to be done in the home
- work done or to be done in respect of the home,
- by a person employed or engaged by the occupier solely to do work of one or both of those kinds in relation to the home.
Safe:
- in relation to a person, means not exposed to any hazards
- in every other case, means free from hazards; - and "unsafe" and "safety" have corresponding meanings.
Serious harm: death, or harm of a kind or description set out in the first schedule to the Act, or declared by regulation to be "serious" for the purposes of this Act; "seriously harmed" has a corresponding meaning.
No regulations for this purpose have been passed to date. Instead, the first schedule of the Act describes serious harm as:
- any of the following conditions that amounts to or results
in permanent loss of bodily function, or temporary severe loss of bodily
function:
- respiratory disease
- noise-induced hearing loss, neurological disease, cancer
- dermatological disease
- communicable disease
- muskuloskeletal disease
- illness caused by exposure to infected material
- decompression sickness
- poisoning
- vision impairment
- chemical or hot-metal burn of eye
- penetrating wound of eye
- bone fracture
- laceration
- crushing.
- amputation of body part
- burns requiring referral to a specialist registered medical practitioner or specialist outpatient clinic
- loss of consciousness from lack of oxygen
- loss of consciousness, or acute illness requiring treatment by a registered medical practitioner, from absorption, inhalation, or ingestion, of any substance
- any harm that causes the person harmed to be hospitalised for a period of 48 hours or more commencing within 7 days of the harm's occurrence
Significant hazard: hazard that is an actual or potential cause or source of -
- serious harm
- harm (being harm that is more than trivial) the severity of whose effects on any person depend (entirely or among other things) on the extent or frequency of the person's exposure to the hazard
- harm that does not usually occur, or usually is not easily detectable, until a significant time after exposure to the hazard.
"Significant hazard" is an important definition for determining the responses required by employers managing hazards under the duties of sections 7-10 of the Act. It is important to note the definition is considerably wider than just a cause of "serious harm". This has the effect of placing employers on notice that they need to identify and manage hazards with the potential for any harm that is not trivial. The harm might only occur after a long time. Likewise, the potential harm may vary in degree according to the intensity or duration of exposure to the hazard.
Subcontractor: a person engaged (otherwise than as an employee) by any contractor or subcontractor to do for gain or reward any work the contractor or subcontractor has been engaged (as contractor or subcontractor) to do.
The Act imposes the same duties on a subcontractor as a "contractor".
Appendix 2:
Sample health and safety policy
For a small contractor or self-employed operator contracting to a larger organisation, or those requiring a health and safety policy as part of their tendering process.
HEALTH AND SAFETY POLICY
XYZ Limited
XYZ Ltd is committed to promoting and maintaining a healthy and safe place to work and to protecting our employees and contractors from injury and property from accidental damage.
We will achieve this by observing the following principles:
- Health and safety in the workplace is an active management function.
- A healthy and safe work environment will be maintained, in
compliance with the Health and Safety in Employment Act 1992. Our Health and
Safety Programme provides that we will:
- Plan ahead to systematically identify and control hazards and ensure employees have the training, supervision, and equipment to be safe
- Maintain emergency and evacuation procedures and train employees in what they need to do
- Monitor the workplace, and record and investigate all
accidents and injuries
- Every manager is responsible for implementing and maintaining a safe and healthy workplace, and for ensuring all foreseeable hazards are eliminated, isolated or minimised.
- Every employee is responsible for ensuring that their duties are carried out safely and without injury to themselves, other employees, contractors and their employees, and the public.
- It is everyone's responsibility to observe safe work practices, rules and instructions relating to their work and the business. Every person, whether staff, contractor, employee of a contractor, or visitor shall comply with the requirements of the Health and Safety in Employment Act 1992.
- XYZ Ltd's Health and Safety Programme is continuously reviewed to further improve health and safety in the workplace wherever possible. All employees with relevant knowledge and expertise can help make the workplace safer, and when making decisions that affect employees and their work, XYZ Ltd will seek information from employees who face the health and safety issues in practice.
______________Managing Director
Appendix 3:
Case studies of best practice for particular contracts
- Contract to build a small residential development
- Harvesting a woodlot for a forest owner
- Local authority lets a contract for a new link road
- Insurance company upgrades its IT and telecommunications cabling in an office building
- Government department lets a contract to clean a large regional office.
Case study 1: Contract to build a small residential development
Principal: Quayside Developments Ltd, a small residential development company operated by Leon Hooper and his wife Glad, who together hold two-thirds of the shares, and with the balance owned by a financial backer not directly involved in the running of the business. Quayside Developments have developed a range of townhouse projects over the last 16 years, always employing some combination of the company's own capital and short-term financing through finance companies and banks.
Contractors: BB Builders Ltd, a four-employee construction company owned by builder Sid Moon, with a minority shareholding held by members of his immediate family.
Project: Construction of four unit-titled townhouses on a subdivided urban section.
Organisation: The developer, Quayside Developments, manages the project themselves, with BB Builders engaged to complete the structural work, and subcontractors engaged by Quayside completing ancillary work such as roofing, plumbing and electrical, and landscaping work.
Pre-tendering: BB Contractors is one of several builders Quayside have used for different projects. Leon keeps pre-tender information in a brief register of suppliers, which is regularly maintained and reviewed after each contract. The register contains financial and legal information on businesses (their bankers, shareholders and legal structure, public liability and other insurances, employee qualifications, trade organisation membership and business alliances, and other relevant information). Much of this general information is relevant to health and safety performance, but some more specific health and safety information is obtained when appropriate. Some of this is also closely relevant to compliance with the Building Act, electricity and gas legislation.
Tendering: Four builders tendered for the contract. Three had completed earlier contracts for Quayside, and one completed a brief pre-tender questionnaire that Leon has used. Tendering was based on working drawings and specifications prepared by the architects and engineers. Leon also included health and safety as an item in the agenda of his meetings with architect and engineer and discussed various issues with them. He also asked that the outlines of a health and safety plan be included in the tender documents.
Some issues were particular to the site. For example, it was on a busy road, so Leon ensured that the tender documents required a plan for parking and traffic management. A steep waterside site presented additional hazards, and the tender documents asked for additional information on how these would be managed with respect to scaffolding and access for vehicles and plant. This also had an impact on electricity cables.
As with other contracts, Leon found he needed to pay particular attention to areas where the work interacted with other contractors, neighbours, or the public.
Tender review, evaluation, and contractor selection
As always, tenders were reviewed on price, availability and other factors including past track record of the tenderers. Leon considered health and safety issues, and looked for evidence of health and safety being noted and thought through by the tenderers. Leon has found this to be an indicator of the quality of work generally. In two cases he asked for additional information on how tenderers would manage particular hazards.
Because Leon was organising subcontractors himself, he and the designers paid particular attention to clarifying roles and responsibilities between the principal contractor and subcontractors.
Awarding the contract and information-sharing
All contracts were in writing and with reference to the tender documents. The health and safety plan is part of the contract documents and is maintained as the project progresses.
Notification of the work under the Health and Safety in Employment Regulations 1995 was the principal's responsibility.
Monitoring performance
Leon is on site and meets with the contractors and subcontractors at least daily. Where practical he arranges informal site meetings to discuss shared tasks and resolve or clarify any issues arising.
Leon's policy is to put any variation involving additional costs to writing, and to formalise any modifications to specification or plans and maintain a master copy agreed with the contractor/ sub-contractor. This is in addition to the documentation required by the Building Act and other legislation.
Leon finds this documentation is an essential aspect of managing the project.
The accurate information has financial and organisational benefits, but also contributes to health and safety by improving people's ability to monitor, plan and respond to situations.
Post contractual evaluation
Leon looks for continual improvement, and completes a systematic evaluation of each project. He records costs, efficiencies made and any holdups, accidents or significant breaches of contract or failures of the contactor and subcontractors progressively, and evaluates these after each project is completed. He also asks contractors for feedback on his own performance.
Case study 2: Contract to harvest a woodlot of plantation timber
Principal: Radiata Investments (1978) Ltd
Contractors: Mac's Logging Ltd
Project
Harvesting a 60-hectare farm-forestry woodlot comprising a plantation of 30-year-old pinus radiata trees on rolling arable land (with a yield of 500 cubic metres per hectare). The contract represented a minimum of three months work for a logging gang of 8-10, and two or more logging truck owner-operators.
Organisation
The owners of the plantation, Radiata Investments, was a partnership between two neighbouring farmers, Gus and Luke, who had planted and managed the woodlot since.
Gus and Luke discussed with the consultant the different ways Radiata Investments might go about realising their investment in the woodlot. They asked a forestry consultant, J P Needleworth, to complete an assessment of the standing volume of the woodlot, and advise on the best time and means of harvesting.
Together they decided to harvest the timber in the summer of year 30, to minimise damage to the land and to make the work easier and more efficient, and so that replanting could occur in the following winter.
The consultant then prepared a logging plan to allow the best recovery of the timber.
Gus and Luke decided to let a tender for logging and transport, and to sell the logs themselves, through a broker, Wooden Agencies. Depending on size or quality, the logs would be delivered to any of three destinations: the nearby port for export quality logs, a pulp mill for the lowest grade of logs, and a local sawmill for domestic grade saw logs.
This way of operating was chosen as an alternative to selling the woodlot to a forestry contractor as a "standing crop". If that had been done, the contractor would then have taken full responsibility for harvesting the timber and made a profit or loss by selling the logs, reducing Radiata Investments' involvement, and their legal obligations.
Pre-tendering
Radiata Investments used their forestry consultant, JP Needleworth, to help with the tendering process.
From the logging plan the consultant could develop a short list of suitable contractors. An advertisement was also placed in the local newspaper asking logging contractors to register their interest.
The consultant maintained, and regularly updated, pre-tendering information on three logging operators who said they were interested in tendering. Two further contractors responded to the advertisements and they were sent a pre-tendering questionnaire for them to complete before being supplied with tender documents. In addition to financial, operational and other questions, the pre-tender questionnaire sought specific information on health and safety management and performance.
Tendering
Tenders were based on the logging plan and other documentation provided by the logging consultant.
The logging plan provided guidance on:
- skills and equipment needed to complete the work
- a detailed site plan and roading plan with suggestions for access from the road, a skid site and other transport requirements
- a proposed plan for directional felling
- estimated yields of particular grades of log
- an outline of delivery destinations/ purchasers' expectations (including dates), and transport requirements
- a standard for quality control
- specified cost components that were to be provided by the tenderer
- reporting expectations and communications
Each of these aspects of the contract has an impact on health and safety, and Gus, Luke and the consultant agreed it was important to provide timely information and describe expectations as clearly as possible.
In addition, tender documents allocated responsibilities between contractor and principal wherever practical. Reporting requirements - on production and quality and incident and hazard reporting were included in the tender documents.
This included responsibilities for interaction with the health and safety inspectorate, regional council and territorial authority as appropriate.
Tenderers were asked specifically for information on their ACC standing, and any workplace injuries over the last two years. They were also asked to indicate any variation from the tender document and negotiate alternatives where appropriate -- in advance of submitting their tender.
Tender review, evaluation, and contractor selection
Four tenders were received. Gus, Luke and the consultant evaluated them together. They reviewed the tenders for price and for completeness against the specification. Two of the tenderers included a company profile showing their equipment, personnel and experience in performing different logging contracts. Gus and Luke found this profile very useful to their decision and in communication with the successful contractor.
Mac's Logging Limited were chosen for various aspects of their tender, not only price. Their provision of information on health and safety management proved to be a good indicator the quality of tender.
Awarding the contract and information-sharing
After Mac's Logging were chosen as the successful tenderer, the consultant produced a written contract based on the tender documents and information received. The parties met to sign the contract and discuss the steps towards Radiata Investments concluding the sale of the logs and competing other steps before Mac's Logging could begin the contract. The work meant that Gus and Luke required some additional fencing to remove gates and allow trucks better access. There was also some minor additional roadwork, and they reorganised scheduled farm work to fit in with the work on the woodlot.
Notification of the work under the Health and Safety in Employment Regulations 1995 was the contractor's responsibility.
Monitoring performance of the contract
Harvesting the woodlot could be described as a medium-sized operation. A total of about 10 fellers, skid workers and machine operators were employed at any one time. The work was organised from one skid site set up according to the logging plan. Log haulage was carried out by up to four trucks coming and going from the site, in addition to the skidders, bulldozers and other machinery.
Regular meetings and site visits formed the basis of the monitoring of the contract.
In addition there were production reports from the contractor, and sales returns from the log purchasers. Gus and Luke checked these for consistency with the logging plan. They also passed the information on to the contractor to do the same.
Once work began there were weekly on-site meetings. These were to discuss progress, and health and safety was on each meeting's agenda. At each weekly meeting the contractor reported on the work completed, and described the work planned for the week ahead, including what and where machinery and personnel would be working and any other information Gus and Luke would need.
Because access was through farmland, Mac's Logging also advised of any additional contractors, such as earthmovers, coming on site, and undertook to report any incidents or significant hazards arising from the work. If Gus or Luke couldn't be present for a site meeting they rescheduled, or at least made contact by phone.
The flow of information from principal meant the contractor could better plan the work, making it more efficient and profitable, and safer for employees and subcontractors. Gus and Luke were in the best position to provide the contractor with information, even in addition to that contained in the logging plan, and it was important to maintain the flow of information.
Post-contractual evaluation
The contract was completed on time within four months, and at the specified rate, and all log sales contracts were met on satisfactory terms.
Radiata Investments completed a formal evaluation of the investment and the contract to harvest the woodlot was part of that. The evaluation report formed the basis of their discussions about further investment in forestry and the use of specific areas of the land after the woodlot was harvested.
The consultant contributed to an evaluation of the contract and used the information to amend their information on logging contractors for future reference.
Case study 3: Local authority lets a contract for a new link road
Principal: Blue Moon Bay District Council
Contractors: Clearway Civil Contracting Ltd
Project: A contract to form and seal a 1.6 kilometre two-lane road through rural land to link the ends of two existing roads.
Organisation: The council engaged civil engineering and project management consultancy, MacAdam, Camber and Partners (MCP) to design and oversee the construction of the new road, including culverts, drainage and related work.
The council selected MCP on the basis of their track record in the design and project management of similar work for the council and other clients. In choosing MCP for the role, the council made specific reference to, and asked MCP to describe their awareness and management of health and safety. This included the health and safety performance of other design work and contracts they had administered.
In addition, in selecting MCP for their role, the council asked for evidence of the consultancy's ability to:
- engage personnel with appropriate qualifications and experience for the role
- maintain an appropriate level of site supervision
- provide and maintain a risk and hazard register - updated at each stage of the contract
MCP advised that the work was best organised through a principal contractor, who would use their own arrangements for subcontractors to carry out work, including:
- earthmoving and haulage
- surveying
- amenities
- asphalt
- road marking
- signage
- suppliers
Before beginning the tendering process, the council had provided information and instructions to MCP including:
- authority to act as its agent on its behalf
- a point of contact within the council and a process for requiring information or authorisations
- requiring a transparent tendering process, with adequate time for tenderers to review and implement the information provided.
Pre-tendering
MCP maintained a list of approved tenderers meeting the council's health and safety, financial, and other requirements. By agreement with the district council, MCP required tenderers to be accredited under either of two health and safety management systems maintained by different sector organisations - "Operate Safe" or "Quest".
MCP also placed invitation to tender notices in trade journals and newspapers seeking registration of interest. Any respondents not on MCP's list of approved tenderers completed a questionnaire, including information on safety and health, and were assessed for entry to the list.
MCP supplied the council with a list of businesses meeting that would receive tender documents for it to review.
Tendering
MCP maintained a procurement regime to suit the risk profile, type and size of the project. It was based on price and non-price attributes, including health and safety performance.
This meant that, where practical, selection criteria that were not price dependent were identified in the tender documents - this included several critical safety components, including traffic control. Although, MCP maintained the ability to further negotiate pricing in those areas. Where there was a "reward" component to non-price criteria, this was specified in the tender documents.
Tenderers were required to document certain safety standards including machinery, traffic control processes, maintenance, and personnel requirements. They were also required to provide a draft health and safety plan for the project.
Tender review, evaluation, and contractor selection:
Four complete tenders were received, two from national companies, one from a regional contractor, and one from a smaller local firm.
Roadworks Contracting Ltd, the regional firm, was selected on the basis of a range of criteria (including the specified non-price elements), as well as their track record, available resources, and their ability to complete the work on time. They also provided details of critical subcontractors they would be using to complete the project.
The contents of the draft health and safety plan was reviewed during the evaluation, although some details were to be completed after the contract was awarded.
Roadworks was able to demonstrate its health and safety performance through membership of the ACC's WSMP programme, and completion of the Operate Safe accreditation process, including being able to report on its performance against national benchmarking (key performance indicators).
Awarding the contract and information-sharing
Although the council acted through MCP as its agents, the contract itself was signed at the appropriate level of delegation within the council.
Awarding the contract always involves the passing of documentation. In relation to health and safety this meant MCP transferring to Roadworks:
- all appropriate permissions and approvals for the work
- design documents
- risk assessment documentation completed during the design and tender stages
- a summary of reporting requirements
- details of contact personnel
Roadworks transferred to MCP:
- the completed health and safety plan for the project
- documentation of personnel qualifications as required
- information on reporting
- contacts for project reporting
Monitoring performance of the contract
The work was scheduled to take place over a total of 30 weeks.
Roadworks provided written reports to MCP monthly. MCP reviewed these reports against tender performance criteria and discussed any points of variance in a report to the council.
Every week there was a site meeting, convened by Roadworks' project manager and engineer as appropriate. The council's contracts manager, engineer or other personnel would also attend when required. An agenda and minutes were kept for each meeting. Health and safety was an agenda item, although frequently other agenda items concerned matters that had an impact on health and safety.
All incidents and accidents on site were reported to the principal via MCP.
Operate Safe formed the basis of Roadworks' health and safety management programme. It has the following components:
Key performance indicators - to allow companies to ensure they meet or exceed the average industry performance - and a requirement for Improvement Plans where performance falls short.
Systems and Training - internal systems to meet the audit requirements of ACC WSMP programme and training ( evidence based) to exceed the H&S E Acts requirements for Induction training, through a hierarchy of cards for operatives, based on national education qualifications (unit standards and National Certificates.).
Auditing - evidence based internal (including maintaining the hazard register) and to meet ACC WSMP accreditation.
Best practice
For training -- through mandatory Operate Safe courses.
For auditing -- through an industry best practice guide (based on a current and sector specific ranked risk and hazard analysis) for WSMP secondary accreditation.
Operate Safe requires agents and principals to review their own performance on site - including ensuring that, at least, records show there is appropriate task analysis, necessary training, and that suitably qualified subcontractors and personnel are being utilised by the contractor.
Post-contractual evaluation
MCP completed a full review of the contract and contractor performance. It used this to monitor its own performance, update its pre-tendering register, and to provide a report to the council. The council's contract manager used the information to plan further work and for planning maintenance and other subsequent work in relation to the new road.
Performance indicator data was forwarded to the national KPIs database held by the Centre for Advanced Engineering (University of Canterbury).
Roadworks reviewed its own performance against the key performance indicators.
Case study 4: Insurance company upgrades its IT and telecommunications cabling in a central city office building
Principal: BFG Insurance Group
Consultants acting as principals' agent: BestTeq Ltd
Contractors: Cabling Solutions Ltd
Project
A contract to replace and upgrade the telecommunications and data cabling on four floors of a central city office block.
Organisation
BFG completed an office reconfiguration and communication technology upgrade that required new cabling for four of the five floors of their head office. The project was managed by a consultancy, BestTeq Ltd, who also organised a firm of systems engineers to complete the design and specification for BFG. The office was not vacated while the work was completed over a period of three months. This meant there was a need for detailed scheduling to maintain separation between the principal's employees and customers and the contractors, while allowing the contractor to complete the work within normal hours as much as possible.
Pre-tendering
BestTeq used the systems engineers' plans and specification to prepare a Request for Tenders document on behalf of BFG.
BestTeq's project manager discussed with BFG's facilities manager possible data cabling companies that could tender. The project manager's experience of using different companies meant that she could help BFG to identify tenderers that met its requirements for quality, staff capability and systems, and that were consistent with the type of project and workplace.
BFG's facilities manager had involved Human Resources and the different workgroups of the office in the design and preliminary project planning, and this information was incorporated in the RFT. It included any work scheduling, maintenance and separation requirements for different work groups. Concerning health and safety, it also included access, security, facilities, and hazard management requirements.
Tendering
Four businesses were invited to tender.
As well as meeting the requirements of the RFT, tenderers were encouraged to suggest was of improving separation from BFG's staff to reduce inconvenience, while balancing the health and safety and practical needs of the contractor and their employees. A health and safety plan was required as part of the tender.
Tenderers were also asked to provide examples of similar projects completed, as part of their tender.
Tender review, evaluation, and contractor selection
BestTeq's project manager completed the tender evaluation and produced a report for principal's facilities manager. This included discussion with the systems engineers.
The basis for the evaluation was criteria included in the RFT, which included references to health and safety management.
Awarding the contract and information-sharing
On the recommendation of the facilities manager, the contract was signed by a senior BFG manager, with the facilities manager as the point of contact with the contractor.
After the contract was signed a meeting was organised between the project manager, the contract supervisor, and BFG's facilities manager and human resources manager to exchange information and gain agreement on how the work would be organised. The meeting covered:
- how BFG staff would be advised and consulted on the work
- reviewing content of the health and safety plan
- how work would be scheduled during the contract
- contact and reporting requirements
- access and security issues
- The health and safety plan was revised and confirmed before work began.
Monitoring performance of the contract
Each fortnight BestTeq's project manager would meet formally with Cabling Solutions' supervisor to discuss progress. BFG's facilities manager was "on-site" to discuss issues as they arose. These mainly concerned movement of BFG's staff into and out of spaces as the work progressed.
Post contractual evaluation
On completion of the contract BestTeq's project manager completed a full project evaluation, and a copy was supplied to BFG's facilities manager.
Case study 5: Government department lets a contract for the cleaning of a large office in a suburban shopping mall
Principal: Department of Wellbeing
Contractors: Immaculate Services Ltd
Project
A contract to clean a large office for 200 staff, and including some public spaces, in a regional shopping centre.
Organisation
The Department of Wellbeing's policy is to review all extended contracts for services at three-yearly intervals. If a right of renewal isn't exercised, the department carries out a full tendering process for a new contract.
The department has standardised contracting processes, including for health and safety. However these are able to be adapted to suit local circumstances.
Pre-tendering
Before the tendering process began, the Department evaluated the existing contractor's performance. This included the facilities manager talking with different work groups and key users within the office, and led to refinements of how the work is organised and the terms of the contract. Various of these had an effect on conditions for contractor staff and on health and safety. A Request for Tender document was prepared after the review.
The contract was placed on the Government Electronic Tender Service and advertised in the local newspaper. When businesses expressed an interest in tendering they were asked to supply some basic information on their capability and experience to prequalify for tendering.
Tendering
The Request for Tenders document was sent to four selected businesses.
The process was led by the department's facilities manager, who acted as the contact point for tenderers. He emphasised that the department encouraged variations or improvements on the RFT document where appropriate. Detailed information was expected on, among other things:
- equipment and personnel being use to complete the work
- any subcontracting included
- referees on performance
- a health and safety plan.
This encouraged tenderers to provide information on quality management, health and safety management and security systems. The request for tenders included a summary of the evaluation criteria that the department would use to select the successful tender. It also included a comprehensive set of safety and security instructions for contractors to the Department of Wellbeing.
Tender review, evaluation, and contractor selection
Tenderers were assessed against the criteria included in the RFT, with specific reference to satisfactory health and safety performance being a requirement.
Awarding the contract and information-sharing
The contract contained specific references to health and safety management. It set out the obligations of the principal and the contractor.
The Department of Wellbeing said it would:
- provide the contractor with all relevant policies and procedures, including emergency procedures, and with information on hazards in the workplace
- ensure access to and maintain the building and equipment in good working order
- take all reasonable steps to ensure a safe working environment
The Immaculate Cleaning Company said it would:
- comply with the Department's health and safety policies and procedures
- notify the department of any hazards identified in the premises by its employees
- provide evidence, on request, of all induction and training procedures, working processes and procedures demonstrating its compliance with its obligations under the HSE Act
- reserve the right, without penalty, to refuse to carry out work under conditions it considers dangerous to its employees, the department's employees, or the public on or near the department's premises.
The contract also contained provisions concerning security, limitations on subcontracting, and mutual undertakings to meet a range of statutory requirements. Immaculate were expected to provide a health and safety management plan.
The contract also required monthly meetings between the department's facilities manager and the contractor.
Regular meetings
A brief monthly meeting covers performance and quality standards, any changes to access or facilities and encourage exchange of information between the office workers and the contractor. The contractor uses the meeting to advise of staff changes and security related issues and any incidents or areas for improvement. Meetings are regular and at the same time and place where practical. The facilities manager sends a note to the contractor in advance of any agenda items beyond usual reporting issues. Brief minutes are also kept of the meeting, of any reporting requirements and any decisions made at the meeting.
Monitoring performance of the contract
The monthly meetings are an important part of the principal's monitoring of the contract. In addition an annual review is completed and the results are discussed with the contractor.
Appendix 4: Key tasks and who does them (Construction)
The process begins
Questions for principals
Have you:
- sufficient knowledge and experience of the construction process?
If so, have you
- considered the level of health and safety required on the project?
- considered how this will be included in the tendering process?
If not, have you:
- appointed a designer/adviser with experience and knowledge of the design and construction process, and an understanding of the health and safety requirements for the type of activity?
Questions for designers/advisers:
Have you:
- considered the level of health and safety required on the project?
- considered how this will be included in the tendering process?
Pre-tender stage
Steps for principals to take:
Ensure consideration is given to how health and safety will be included in the documentation, by analysing relevant health and safety information, such as existing drawings and any existing site safety plan including any known hazards, surveys of the site or premises, or information on the location of services.
Ensure consideration is given to how health and safety will be included in the tendering process. This may include adopting a pre-qualification procedure to help establish a shortlist of appropriate tenderers.
Provide designers/advisers (if any) with relevant health and safety information (such as existing drawings and any existing site health and safety plan, including any known hazards, surveys of the site or premises, or information on the location of services).
Begin work on the project health and safety information to be incorporated into the tender documents.
Questions for principals, where pre-qualification is to be used:
Have you:
- developed a pre-qualification procedure and forwarded this, (along with any significant health and safety information available at this stage) to potential tenderers to help establish a shortlist of tenderers?
- provided advice to the client (if any) on the short-listed contractors who have the required health and safety competence?
Have you also:
- begun to prepare the project health and safety information?
- obtained sufficient information from the client and other parties to make sure the project health and safety information is prepared competently (such as drawings, job specifications and product specifications)?
Questions for potential tenderers:
Have you:
- familiarised yourself with any pre-qualification health and safety requirements?
- responded by providing the client with health and safety information requested in any prequalification procedure (such as completing a pre-qualification checklist if requested by the client)?
- forwarded supporting documents providing evidence that company practices and procedures for health and safety are in place?
Tendering
Questions for principals:
Have you:
- ensured the health and safety selection criteria has been finalised?
- made sure sufficient time has been allowed for tenderers to adequately present their tender and respond to the requirements for health and safety?
- considered whether the proposed time period for the project would adversely affect health and safety?
- made sure that the tender documents include sufficient information for tenderers to effectively develop and cost a health and safety plan to complete the project safely? This should include ensuring the project health and safety information has been prepared and any significant known health and safety risks and hazards of the project have been included and identified in appropriate parts of the tender documents.
Questions for designers/advisers
Have you:
- prepared appropriate project health and safety information on behalf of the client?
- ensured project health and safety information is included in appropriate parts of the tender documents, identifying any significant known health and safety risks and hazards of the project?
- developed the health and safety criteria for evaluating tenders and considered whether to include this in the tender documents?
- considered whether the proposed time period for the project would adversely affect health and safety?
- where necessary, held a face-to-face meeting or site visit with tenderers to explain health and safety requirements?
- allowed time for potential contractors to adequately present their tender to meet the requirements for health and safety?
Questions for tenderers
Have you:
- familiarised yourself with the tender documents, construction site and the health and safety requirements of the project?
- received adequate information to determine what is necessary for health and safety on the project?
- developed a clear specification of the resources needed to control and manage the health and safety risks and hazards of the project?
- included with your tender information outlining how you will deal with any specific risks and hazards during the project, and provided evidence your tender meets the health and safety requirements of the project and the tender documents?
This may include:
- developing a preliminary site-specific health and safety plan, outlining how you will manage and deal with the risks and hazards during the project
- providing evidence subcontractors you nominate are committed to health and safety and are able to perform their role safely
- providing evidence health and safety has been acknowledged and included in your tender
- providing any additional health and safety information you consider relevant to the project which has not been asked for.
Note: much of this information will contribute to the site-specific health and safety plan developed by the selected contractor once appointed.
Finally, have you:
- ensured your tender shows a full understanding of the level of health and safety required for the project?
Appendix 5: Workplace injury and fatality rates in industries with high levels of contracting work
Industries which have high levels of contracting for services also tend to have higher workplace fatality and injury rates.
This is illustrated by the table below, which suggests a correlation between workplace fatality data and the three industry classifications with high levels of contracting.
| Industry | Total claims (000) |
Percentage of all claims | Full-time equivalents (000) | Injury Incidence rate | Number of fatal claims | Fatality incidence rate |
|---|---|---|---|---|---|---|
| Total | 235.2 | 100 | 1,873 | 126 | 81 | 4 |
| Agriculture, forestry, and fishing | 22.8 | 10 | 129 | 177 | 19 | 15 |
| Mining | 1.0 | -- | 6 | 165 | <4 | -- |
| Manufacturing | 43.6 | 19 | 264 | 165 | 6 | 2 |
| Electricity, gas and water supply | 1.0 | -- | 8 | 122 | - | - |
| Construction | 26.4 | 11 | 174 | 152 | 23 | 13 |
| Wholesale trade | 8.6 | 4 | 95 | 90 | <4 | -- |
| Retail trade | 16.8 | 7 | 223 | 75 | <4 | -- |
| Accommodation, cafes and restaurants | 5.8 | 2 | 75 | 77 | - | - |
| Transport and storage | 8.8 | 4 | 76 | 116 | 7 | 9 |
| Communication services | 2.4 | 1 | 33 | 72 | - | - |
| Finance and insurance | 1.2 | 1 | 66 | 19 | <4 | -- |
| Property and business services | 14.9 | 6 | 219 | 68 | <4 | -- |
| Government administration and defence | 3.9 | 2 | 84 | 47 | <4 | -- |
| Education | 7.0 | 3 | 139 | 50 | - | - |
| Health and community services | 9.6 | 4 | 161 | 60 | <4 | -- |
| Cultural and recreation services | 5.8 | 2 | 42 | 136 | - | -- |
| Personal and other services | 6.4 | 3 | 75 | 86 | <4 | -- |
| Not specified | 49.2 | 21 | 6 | .. | 11 | -- |
Sources: Accident Compensation Corporation, Department of Statistics Household Labour Force Survey (HLFS).
Incidence rate = number of fatal injuries/100,000 FTEs
- nil or zero
-- figure too small to be expressed