Ensuring Contractor Compliance: The Importance of Prequalification Policies
Managing contractors can certainly present challenges. One specific challenge is when a contractor attempts to bypass vetting requirements. A recent experience exemplifies this issue, emphasizing the critical need for enforcing prequalification policies.
Case Study
In a recent scenario, we encountered a contractor who failed to meet prequalification standards yet continued to receive work from a site manager anyway.
A contractor, with a long-time friendship of a site manager within a large company, consistently secured lucrative projects despite having a red prequalification score due to their high EMR and DART rate. Although the company had an established prequalification program, it was loosely enforced at the onset allowing such activities to occur for a while.
Non-Compliant
The hiring client’s prequalification program prevented the contractor from being awarded contracts without corporate approval. So, the contractor attempted to bypass the prequalification protocol by asking the site manager friend to award the contract to a qualified contractor (contractor B), but then having them sub out the actual work to contractor A.
Sub-Contractor Prequalification
The plan to subcontract the work to Contractor A could have succeeded if the hiring client’s prequalification program didn’t extend to subcontractors. Because of this requirement, Contractor B, with a free Client/General Contractor/Subcontractor account, followed client protocols and requested Contractor A’s prequalification status.
After a quick review, Contractor B opted not to accept the work. They felt uneasy about hiring Contractor A as a subcontractor due to their poor safety record and potential liabilities. Prioritizing integrity over profit, Contractor B informed the hiring client of their discomfort with the site manager’s request. This prompted an internal review, resulting in Contractor A’s disqualification from future bids—a valuable case study highlighting the importance of compliance adherence.
Conclusion
Enforcing prequalification policies is crucial for maintaining safety standards and contractor compliance. This case underscores the importance of thorough vetting not only of contractors but also subcontractors. Prequalification programs should encompass all tiers of contractors to ensure a safe working environment.
Key Takeaways
- Compliance through enforced prequalification policies is paramount.
- Setting clear requirements ensures a pool of evergreen contractors.
- All employees, regardless of position, must adhere to prequalification guidelines.
- Prequalifying subcontractors is essential for a comprehensive prequalification program.
- Prequalification works!
If your safety program lacks subcontractor prequalification, consider reevaluating. Ensure all contractors and sub-contractors adhere to your safety standards.
The hiring client in this case requires all contractors and subcontractors working on site to be prequalified. This step enabled them to prevent potential increased liabilities by avoiding hiring a non-compliant contractor – who even tried to skirt the process.
Contact CanQualify for more information on how we can help you build a prequalification program tailored to your specific needs.
