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Contractor Due Diligence and Liability in Safety is CRITICAL and Necessary!

A friend of mine asked me to type about CONTRACTOR Due Diligence in Safety and Liability the other day and I remember many incidents over the years based upon our brief notes. REMEMBER SITE SAFETY IS TEAM SPORT NOT JUST IN DOING BUT IN THE COURTS JUDICIAL RESPONSIBILITIES AND BOTH PARTIES CAN GO TO JAIL FOR NOT FOLLOWING THE RULES!

Many folks have noted including the courts! The owner’s subcontractors are making every possible common mistake in the books and creating hazards for both the other contracted workers on site as well as the public entering the facility they are remodeling. And where is the safety program!

Case law after case law after TORT case in our judicial system have noted. The judgment is a reminder that responsibility for safety in the workplace is a shared responsibility. Employers and principals both play a part and may be held liable for injuries to workers under both occupational health and safety legislation and the tort of negligence. Businesses cannot simply turn a blind eye and do nothing where independent contractors used by them are engaging in unsafe work practices.

REGARDLESS OF WHERE YOU WORK ON THE GLOBE AND JUST BECAUSE YOU DON’T OWN THE COMPANY OR THE PROJECT DOES NOT MEAN IN THE NOT JUST THE COURT SYSTEM BUT IN PUBLIC LIABILTY YOU THE WORKER ARE NOT LIABLE FOR DAMAGES. I remember one worker a couple of years back being not just liable but the INSURANCE COMPANY for the site successfully sued the worker for 1.5 million dollars in damages because the worker after repeated warns didn’t do the work right. How did it come to that level, well the insurance policies required to be carried under this agreement shall include an endorsement stating that the coverage afforded the Additional Insureds/Indemnified Parties will be primary to any other coverage available to them and provided on a non-contributory basis. As such, XYZ Company and all other Additional Insureds/Indemnified Parties shall not be liable for the payment of any premiums, deductibles, claims, co-insurance, retentions or any other costs or expenses under the aforementioned insurance policies.

In Canada and the USA, It is possible for a general contractor to ask his subcontractors to sign a waiver that discharges him of his liability in the event of a material injury. However, the general contractor will remain liable if there is an intentional or gross fault on his part. A gross fault shows recklessness, carelessness or negligence.

And in the USA, Contractors are already required to disclose findings of fault and liability made in administrative or civil proceedings.

Contractor Safety: Limiting Your Liability Project Risk Consequences • Third party bodily injury • Third party property damage • Injury to workers or employees • Damage to surrounding operations • Direct physical damage to the work • Failure to perform to specifications • Government fines and/or mandated actions • Remedial design or construction • Cost overrun • Failure to complete on schedule • Project shut-down

So on top of being possibly skidded for not doing it right in safety. Dealing with contractors on site who don’t know of, or adhere to, your safety procedures can be risky. Subject to fines or even jail time when not compliant with legislation, you’re not interested in potentially spending unnecessary capital for other measures to keep workers safe on site. In the USA and Canada, OH&S indicates that “to the extent that a subcontractor of any tier agrees to perform any part of the contract, he also assumes responsibility for complying with the standards in this part with respect to that part…With respect to subcontracted work, the prime contractor and any subcontractor or subcontractors shall be deemed to have joint responsibility.”

So before you hire that third party or have people on site ignoring your programs in safety consider and this is certainly an area where time should be spent – Select a safe contractor using company criteria – State your company’s safety expectations in a contract the same way your fundamental terms and conditions are stated – Communicate your safety expectations to pre-qualified contractors prior to awarding the contract – As best you can ascertain the contractors commitment to safety – Audit and monitor work while it is being done to ensure safety expectations are being met – Periodically evaluate performance in each prior step

When you sign off on the work contract or safety program a LEGAL BINDING DOCUMENT that has been entered into law courts many times. Do the contractor safety practices at your workplace consist of reliance on contractual sign-offs in which the contractor agrees to be “fully responsible for compliance with all applicable health and safety legislation and standards”?

In Canada and as per the USA in similar legal statement and liablity suits. The dictionary, commercial practice and common sense all lead us to think of a contract as having full legal effect. Yet, under oh&s laws across Canada, nothing could be further from the truth.

The oh&s legislation across Canada gives employers and work site owners duties and responsibilities for their own directly hired workers as well as for the workers of contractors. Although this is accomplished in different ways in each province, the same result follows. Some jurisdictions, such as the Yukon, Nova Scotia and Ontario, expressly define “employer” to mean a person who employs one or more workers or who contracts for the services of one or more workers, to perform work or supply services.

In other provinces and under the Canada Labour Code, where the definition of “employer” is less expansive, obligations for contractors exist as a result of general obligations placed on employers for work carried out under their control. For example, British Columbia’s general duty clause for employers states that they must ensure the health and safety of “all workers working for that employer, and… any other workers present at a workplace at which that employer’s work is being carried out…”.

The law states in the general duty of care under health and safety legislation and is non-delegable, meaning that it is a duty that you cannot contract out or transfer over to another party

For any contractors to protect themselves and take preventative safety measures:

·        Get it in writing

·        Identify, address and correct hazards

·        Communicate and coordinate with subcontractors

·        Assign a qualified coordinator

·        Establish an emergency response plan

·        Maintain accurate records

Essentially, it’s best for both employer and contractor to take the above tips into consideration when working together.

Both company that hired you and you the worker are legally responsible for ensuring their health and safety at all times while in your workplace (to the extent that this is reasonably practicable). For example, you should ensure that your workplace, any machinery, substances and facilities used are safe, and that all workers have adequate training, supervision and are properly licensed if required.”

This statement of he said she said or they said didn’t work in Regina v. Wyssen c.o.b. Jake Wyssen Enterprises (1992) 10 O.R. (3d) (Ont. Ct. Appeal)

The contractor proceeds to perform the work, but contravenes a fundamental health and safety requirement for the work; now your corporation faces prosecution for failing to ensure that the contractor complied with these legal requirements.

In court, you argue that you engaged the contractor precisely for its special expertise. Yet the court finds that you cannot contract out of your health and safety obligations, no matter how well-drafted the contract. (One exception where responsibility and liability may potentially be contracted away successfully, is where a general contractor is retained as “constructor”, “prime contractor” or “principal contractor” to take responsibility for the entire site or project and all contractors on the site.

The courts have further ruled in both Canada and the USA, For every person granted access to the workplace: • By the employer, provide prescribed safety materials, equipment, devices and clothing • By the employer, ensure that person is familiar with and uses in the prescribed circumstances and manner all prescribed safety materials, equipment, devices and clothing • Ensure that the activities do not endanger the health of employees • Other than the employer’s employees, take all reasonable care to ensure informed of every known or foreseeable health and safety hazard to which they are likely to be exposed in the workplace

And

All reasonable care is composed of stringent court-developed standards: • Knowledge of legal obligations • Hazard identification and assessment • Corrective action based on assessment of hazards • Appropriate orientation and training • Competent supervisors and trained workers • Supervisory monitoring to confirm practices and procedures followed • Communication of hazard information to workers • Discouragement of safety infractions with discipline • Ongoing documented steps

Aside from the specific recommendations set out above, we often help our clients develop policies and procedures for construction work. We recommend that all project owners have such policies in place and ensure that all personnel, from those who engage contractors and general contractors to on-site personnel, be trained to avoid missteps that could saddle the company with constructor liability.

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