WHAT TO DO WHEN . . . . You Have Contractors Working On Your Premises - Part 1

There will be no article on Monday or Tuesday next week - I will be out of town.

ARTICLE 42

WHAT TO DO WHEN . . . . You Have Contractors Working on your Premises – Part 1

By Nikki Viljoen of Viljoen Consulting CC September 2009

According to the law, if you have contractors working on your premises you are liable for their health and safety.

Here’s the story

Mike owns a retail store in a busy mall. Mike’s business is doing really well and the store next to his has become available and Mike decides that he needs to expand his operation into that space.

So Mike hires George, the contractor and soon work begins. Mike is really impressed at the way George and his team go about getting the work done.

Within hours there are ladders all over the place and workers are going about their specific tasks. All of a sudden, there is a loud CRACK/SNAP and a ladder collapses as one of it’s legs shatters. Phillip, who is on the top of the ladder, doing something in the ceiling, falls some three meters and lands on the concrete floor with a loud THUD. Phillip’s one leg is lying at a very odd angle beneath the rest of his body and it is clearly broken and it is also clear that he is hurt badly. The ambulance is summoned and Phillip is rushed off to hospital.

Now we get to the serious bit – the money. Who is responsible for what? Here’s the thing, if George, the contractor is not compliant in terms of the Health and Safety Act, then Mike is liable and responsible for all the costs including but not limited to, the cost of the accident, medical costs, rehabilitation costs and even 75% of employees wages.

Let’s see what Mike has to do in order to ensure that he will not be held financially accountable and/or liable for the safety and health of the contractors working in his store.

One of the things that Mike should have included in this procurement policy is that the contractor (in this case George), would need to sign a Section 37(2) agreement. The agreement would need to state (but not be limited to) that the contractor will comply with all health and safety laws and company rules (in this case Mike’s Company). Mike should also insist in obtaining a certified copy of George’s “Certificate of Good Standing” from the Compensation Commissioner, which will evidence that the contractor (in this case George) is in fact registered and complaint with the Workmen’s Compensation fund.

Next week we will have a look at some of the other issues that Mile should include in his Contractor Procurement Policy to ensure that everything is managed correctly and that Mike is in no way liable for anything other than the Contractors invoice.

Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za