Contractor Safety Prequalification: The Significant Limitations of Loss Rates
- David W. Wilbanks (Murray State University)
- Document ID
- American Society of Safety Engineers
- Professional Safety
- Publication Date
- July 2019
- Document Type
- Journal Paper
- 22 - 26
- 2019. American Society of Safety Professionals
- 5 in the last 30 days
- 5 since 2007
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- Hiring organizations give great weight to injury history when conducting prequalification of prospective contractors. The validity and reliability of this practice are questionable, as the data are lagging, often statistically insignificant and normally not audited.
- Contractors have been known to produce false or underreported data, and overinterpretation of small numbers often undermines the utility of contractor injury rates.
- This article discusses the use of experience modification rate statistics such as injury rates, which presents unique challenges that are not readily solved. The author recommends alternative criteria.
Safety prequalification practices are increasingly recommended and used for contractor selection with the goal of reducing work site incident risk (Burroughs, 2015; Hannan, 2015). Whether prequalification is facilitated by the hiring organization or a third-party service provider, it is prudent to investigate the criteria commonly adopted. Does the practice actually provide the benefit desired, that is, safer contractors? The author recently examined the popular requirement of submission and review of contractor written safety programs and found the practice wanting (Wilbanks, 2018). Reliance on contractor loss statistics is another deserving discussion.
Contractor injury history may be the most valued safety prequalification criterion; a recent survey of steel industry safety professionals found that more than 75% of respondents considered it to be a very or an extremely important factor when selecting contractors (Wilbanks, 2017; Figure 1).
The same study also found that contractor injury history remained the single most important factor (Kendall’s W = .224, p < .05) after respondents were asked to force rank it along with seven other possible contractor prequalification data points: employee training and certification; capacity to complete the work safely; liability and regulatory history; related work experience; written safety programs; reputation; and financial stability. Interestingly, the volume of contractor incidents claimed to have been observed by the respondents during their careers did not significantly influence their perception of the importance of evaluating contractor injury history (Spearman rank order correlation test, r = -.022), or any of the other data points. Finally, a test was conducted to determine whether significant differences exist between specialists, managers and directors, and the importance of evaluating contractor injury history assigned by them; such differences were found to exist (Kruskal-Wallis H test, X2 = 6.648, df = 2, p < .05). Interestingly, safety specialists placed greater importance on contractor injury history than did directors (post hoc test, median 6.0 and 5.0, respectively). Yet both groups rated the factor highly, that is, at least 5 on a 7-point scale, with 7 reflecting the greatest importance. Thus, contractor injury history may be considered a gateway prequalification factor (Cauchon, 2014; Inouye, 2015; Philips & Waitzman, 2013; Sparer, Murphy, Taylor, et al., 2013). An unfavorable history may be immediately disqualifying.
|File Size||241 KB||Number of Pages||5|