The intent of this article is to identify and discuss the processes and programs construction companies can and should implement to avoid the disastrous consequence of human error and acts of god. The focus of this article will be on the General Contractor, but the message is relevant to Architects and Owners as well as the attorneys who represent them. Disaster on a construction project casts a wide net that easily envelopes the entire project team. It is, therefore, the obligation of every conscientious Owner and Architect to ascertain, with specificity, the disaster avoidance plan proposed by each prospective Contractor. Avoiding disasters is a team effort and the Contractor must show the way.

The way to avoid disasters on a construction project requires a commitment to comprehensive safety and quality management programs--effectively planned and aggressively implemented. The goal is not easily attained and there are no shortcuts, especially in construction.

Construction is not for the feint of heart. Construction is a risky business. By the very nature of its work, construction is constantly exposed to the vagaries of nature, the caprice of chance and the inevitability of human error. According to the 2005 Census of Fatal Occupational Injuries in Illinois in 2005, published in 2006 by the Illinois Department of Public Health, the construction industry ranked third behind transportation and agriculture on the list of industries with the greatest number of fatal injuries in Illinois. Thirty construction workers died in work related incidents. In 2006 the Department of Public Health issued a report identifying occupations with the greatest number of work related injuries. Construction carpenters and laborers ranked in the top ten. The average length of time off due to on-the-job injury for carpenters and laborers was also amongst the highest of all occupations ranked in Illinois. Work related injuries are not the only potential cause of disasters. The industry faces a rising tide of construction defect and related mold claims.

So what is a Contractor to do? Contractors cannot simply “take the pledge” and swear off all manner of risk. Risk permeates everything a Contractor does; it is unavoidable. The successful Contractor, the construction company that succeeds and is passed down from generation to generation accepts the risk of construction, but adapts programs that avoid the disastrous possibilities. There are two ways to avoid the consequence of disaster but only one way to avoid the disaster itself. The first way is risk transference. Risk transference is reactive. It assumes the event (cause) and seeks, by contract, indemnification or insurance to pass the consequence (effect) to someone else. The second way is proactive and seeks to prevent the event and, thereby, avoid the consequential disaster.

This article will focus on how to stop failures or mistakes on projects that can lead to disastrous consequences. There are three steps Contractors must take to avoid a disaster on a project. First, the construction company must make an absolute COMMITMENT to safety and quality management. The second step is the formulation and dissemination of PLANS addressing safety and quality management. The third step is IMPLEMENTATION of these plans in everything the company does.

COMMITMENT

Total commitment to safety and quality must come from the very top of the company and percolate down through all levels of the organization. Everyone must know both rationally and intuitively, that safe and quality work is an intrinsic part of the company culture. This degree of awareness cannot be achieved unless it is conveyed clearly and repeatedly from the President/ CEO.

The company's commitment must be ongoing and needs to be repeated and constantly reinforced. If successful, the company will come to define itself by its commitment. The Contractor will begin to see itself as a company that works safely, provides quality work, on time, within budget, and makes a reasonable profit in the process. Once the proper mindset is achieved, the company is prepared to take the next step -- the formulation of disaster avoidance plans.

THE PLANS – The say what you do phase

The next step on the path to disaster avoidance is the formulation and publication of safety and quality management manuals. These manuals provide a comprehensive statement of the company’s safety and quality management policies and procedures. They should also identify and describe those steps that are necessary to safely provide high quality work. Representatives from all levels of operations should engage in the preparation and maintenance of these documents. Buy-in is essential. The Safety Manual and Quality Management Manual must be updated on a continuing basis. These documents must evolve with the company's experiences and must constantly reflect the company’s continuing commitment to safety and high quality.

Be sure all operations employees are given a copy of the Safety Manual and all management personnel have a copy of the Quality Management Manual. A text of both documents should be placed on the company’s website for ease of reference. Remember, the Safety Manual must be maintained at every project site to comply with OSHA requirements.

Unfortunately, manuals tend to be set aside to gather dust on someone’s shelf. Do not let this happen. Use and reference to safety and quality manuals must become commonplace within the company. Manuals should be used to instruct employees in periodic classes on safety and quality management.

A commitment, no matter how deep, and plans, no matter how thorough, cannot avoid disaster without vigorous implementation. The safety and quality management plans must have action steps, procedures that effectuate the stated policies. Implementation is the final piece in a program that provides the best chance to avoid disasters.

IMPLEMENTATION – The do what you say phase

Implementation is the most difficult ingredient in the recipe for avoiding disasters. Unfortunately, it takes more than ‘want to’ and wishes to avoid disaster. At some point, ideals must be executed and put into practice.

Successful implementation begins with bringing quality subcontractors and employees to your project. To avoid disasters, Contractors need to blend quality subcontractors and employees into a system of procedures and practices that allow the project team to maximize their potential. Good people help assure good results. Accepting the lowest bidder may very well be the worst possible choice a Contractor can make. The low bidder may get you the job, but you may rue the day you were awarded the contract.

Subcontractors – Contractorsmust know the subcontractors they work with and their level of commitment to quality and safety. It is essential that a Contractor prequalify a subcontractor before making final selections. At Berglund Construction Company, our Subcontractor Pre-Qualification Questionnaire (Attachment ‘A’) must be completed before a subcontractor is selected. The structure and contents of a prequalification form can vary extensively, but it should answer five basic questions: 1) who are you; 2) what work have you done in the past; 3) who are your references; 4) what is your record for safety; and 5) what is your financial condition. In our experience, quality or the commitment to quality is best determined from personal conversations with the references provided by the subcontractor and discussions with the subcontractor. Therefore, the form places greater emphasis on safety information. Fortunately, there are enough recognized safety standards that the answers give a reliable gauge of the subcontractors’ safety performance.

Employees - Contractors that self perform portions of the construction work must, to the extent allowed by law, screen its own employees. Screening begins with an Employment Application (Attachment ‘B’). In addition to obtaining basic information, the form is used to notify applicants that certain tests are given as part of the hiring process. Berglund requires a drug test and a post offer fitness for duty test. The fitness for duty assessment is performed by a licensed agency that administers physical tests that are appropriate given the job description of the position applied for. Hiring construction workers without drug and fitness assessments is an invitation to disaster. A word of caution, permissible hiring and assessment practices vary by locale and should not be instituted without the advice of an attorney.

New employees are prone to mistakes and mistakes can lead to disasters. Therefore, new field employees should be given special attention. When hired, Berglund field personnel are required to participate in a two hour safety meeting conducted by the Safety Director. When they first go to the project, they meet with the Project Superintendent and are given a comprehensive briefing on the important aspects of the Project, including safety considerations. The new worker is given a hardhat with a color that distinguishes them as new to the project. In addition, they are assigned a Mentor who helps guide them through their first weeks on the project.

All employees, no matter how long employed, should be given some form of continuing instruction on the subjects of safety and quality. Supervisory personnel should attend formal classroom instruction at least twice a year. Instruction can be conducted in-house or through outside agencies. Trades people can receive training in the field. The weekly toolbox talks provide an excellent opportunity for instruction.

A well qualified and trained staff working with prequalified subcontractors still needs safety and quality practices and procedures to better assure the avoidance of disaster. The following is a list of some practices and procedures or action steps that, when properly implemented, can help assure avoidance of disasters:

  1. Preconstruction Meetings

Before a project is begun, the Project Manager convenes a preconstruction meeting with the Contractors key project people. The intent of the preconstruction meeting is to identify key quality and safety issues and address them before they are confronted in the field. Attachment ‘C’ is a four page Preconstruction Safety Checklist used by Berglund Construction. The first page consists of general information concerning the specific project. The second page contains a check-off list of safety and quality concerns that are routinely encountered on projects. The intent is to motivate or engender discussions regarding aspects of the project that might otherwise be overlooked. The third page provides space for the Project Team to identify and describe safety and quality issues that must be addressed in the course of the project. For instance, on a project that involves the installation of windows, the team would consider how air and water integrity can be maintained.

Finally, prior to commencing the work, the subcontractor fills out a Subcontractor Project Safety Plan (Attachment ‘D’). Subcontractors then meet with the Project Manager and Superintendent to discuss the contents of the Safety Plan.

  1. Scope Reviews

Before construction, subcontractors meet with the Contractor’s estimators for a thorough scope review. Quality control and assurance is always a significant subject on the agenda. The primary focus is conformance with the Architects design criteria. An inspection and testing protocol is established.

  1. Mock Ups

The frequent use of mock ups is highly recommended. Mock ups should be used to demonstrate the performance of critical building components before installation. Problems that might otherwise cause a disaster are exposed and corrected safely and without undue disruption to the project schedule.

  1. Pre-start Huddles

Daily meetings between the construction crews before the work begins are a great way to avoid mistakes and the disasters they can cause. At Berglund, these meetings are called "huddles" because they serve the same purpose as huddles do during football games. Each day, the workforce ‘huddles up’ with the Superintendent. They discuss the day’s activities to make sure everyone understands what they will be doing and the particular challenges posed that day. Some superintendents conduct “two-a-days” and huddle up after lunch. The Huddle Card (Attachment ‘E’) is used to document these meetings.

Huddles remind everyone that safety and quality defines the company and everyone in its employ. In addition, and most importantly, the huddle is our best chance to remind our people to “Be careful out there”.

  1. Project Management Huddle Card

When a Project Manager visits a work site, he completes a Project Management Huddle Card (Attachment ‘F’). The Project Manager’s inspection reinforces for the entire Project Team the Contractor’s commitment to quality and safety. You will note that once this card is completed, it is forwarded directly to the President of the Company.

  1. Accountability

Accountability assures proper implementation. There are a myriad of accountability methods and plans to choose from. For example, it is Berglund’s policy that in the event of any injury or near miss, the Superintendent is required to call the President of the Company within 15 minutes of the incident. Project Managers’ are also held accountable for safety and quality. Their year end bonus is based in significant part on their quality control and safety performance.

If All Else Fails

Nothing in life is a sure thing and, no matter how hard one tries, there is no guarantee disaster will be avoided. Therefore, the prudent Contractor must take steps to protect itself in the event proactive prevention fails. Here are a few suggestions:

  1. Subcontracts need to be carefully drafted to assure proper assignment of responsibility and the transference of the risk that comes with it. Of course, subcontractors should never be allowed to start work without a fully executed contract.
  2. The Contractor must require the Subcontractor to provide, along with its insurance certificate, its additional insurance endorsement naming the Contractor, Owner and Architect as additional insureds. Be aware of Additional Insured Endorsements that offer very limited coverage.
  3. The project should have Builders Risk Insurance covering the project and Property Insurance covering adjacent property. Obtain a waiver of subrogation.
  4. Require Payment and Performance Bonds from the more important subcontractors.
  5. Have a Disaster Response Program in place.

If avoiding disaster was easy, there would be none to discuss. It is a hard, but passable road and the journey is well worth the effort. In my tenure at Berglund, I have watched our EMR fall from 1.36 to .59. The industry average is 1.00. It was not easy, but looking back we recognize that in the effort we have become a better in everything we do.

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