Who Manages HSE in Contracts?

ISO 45001, which I never tire of quoting and breaking down into its components, has presented us with another interesting process — contractor management.

The process of managing contractors from a financial perspective is clear, as it has existed for a long time. This commercial process gave us the term "contract specialist." This person usually has a legal or financial background, knows how to navigate the industry, understands the company's business processes, knows how to calculate costs, see financial benefits, conduct negotiations, and much more, without which the commercial component of a contract specialist's work is unthinkable.

But we are faced with the requirement of contract management through the prism of HSE... That is, we are talking about an "HSE contract specialist."

Imagine for a moment the number of contracts a company operating a hazardous production facility has. Catering, all types of maintenance and repair work, personnel/equipment/hazardous waste logistics, supply, construction work, and so on and so forth.

The main goal of the contractor management process is to achieve the company's production goals safely, qualitatively, and in full, rather than to "fleece the contractor," "tear the contractor apart," "crush the contractor with fines," "sabotage the contractor's work," "check the certificates and call it a day," and so on... You must agree that when a contractor's employee dies at a site, it casts a serious shadow on the site operator as well. Not to mention the investigations and visits from representatives of relevant authorities.

Conventionally, the work of an "HSE contract specialist" can be divided into 3 stages: the preparatory stage, the actual work with the contractor, and the completion of the contract. However, it must be stated immediately that under no circumstances is such work carried out alone. This is the coordinated work of the "legal/financial contract specialists," the employee appointed as responsible for the contract, the employee responsible for the entire contract budget, and the "HSE contract specialist."

Despite the apparent simplicity, it is necessary to understand that every major brief event, in turn, unfolds like a fan into a complex of component actions, which are also quite complex. An employee who manages HSE processes in contracts must have a clear understanding of and connection with legal and financial issues.

Let's try to break everything down in detail.

1. Preparatory stage:

• Assessing candidate compliance against the evaluation matrix during selection.
• Determining the type of contract.
• Developing criteria for evaluating contractors on industrial safety issues within the framework of selections (both for the first stage to determine the "shortlist" and for the second stage to determine the tender winner).
• Preparing and updating standard contract clauses regarding HSE requirements.
• Participating in pre-qualification audits of candidates who submitted proposals for participation in the selection procedure for work/services.
• Preparing reports on the results of pre-qualification audits of candidates who submitted proposals for participation in the selection procedure for work/services (in my experience, this is not required very often).
• Participating in clarifications upon request from tender participants.

2. The next stage is working with the contractor.

This is necessary to ensure compliance with the terms of the contract. An "HSE contract specialist" helps find systemic solutions to problems that arise during the performance of work under the contract:

Main activities, including but not limited to:

• Conducting pre-mobilization inspections.
• Conducting major risk assessment sessions for the entire project together with the contractor.
• Conducting pre-start sessions before the project begins.
• Monitoring activities at the site.
• Establishing communication schemes with the contractor's management.
• Assigning a rating to the contractor based on the results of the pre-mobilization audit and work performance.
• Defining motivational payment schemes under the contract for contractors.
• Full methodological and consulting assistance during contract work for the contractor and those responsible for the contract.

3. The final stage of contractor management.

• Monitoring the implementation of measures.
• Preparing and conducting a final meeting based on the results of the work, including statistical data on the contractor's activities (for the year or for the contract period).
• Developing a final dashboard.
• Preparing a reasoned recommendation for further work with the contractor.
• Participating in final dispute resolutions.

As we can see, the qualification requirements for such an HSE employee are very high; therefore, an organization that decides to implement a contractor management process must realize that hiring "just any HSE officer" will not yield quick results.

A short-term solution would be to poach such a specialist or hire an external consultant (financially costly!).

A long-term solution is to train such a specialist within your company (costly not only financially but also in terms of time). It is necessary to have the resource of an employee who will teach the newcomer.

Take care of your specialists; they are the foundation of your company's intellectual and human capital and the key to success!