
Red flags when selecting a contractor
What are some red flags you guys look for when selecting a contractor? Also, what does your bidding process look like when selecting a contractor - any parameters you guys typically look for?
Comments (6)

I do the same process now for my customers as I did when I was in corporate America. Every contractor and subcontractor gets fully evaluated, including a copy of their safety manual, COIs (meeting minimum requirements), a prequalification form that asks for all their safety metrics (e.g., OSHA 300A info, environmental spills, etc.), and a few others. I always try to do a 2-week turnaround when I'm evaluating contractors/subs for my clients, then their "grade" is good for 1 year from that date. Each evaluation criteria is on a weighted scale, all of which adds up to a score out of 100.
Fatalities are a red flag, but not automatic dismissal - just requires some digging. It could've been a crew irrelevant from the crew you're needing at your site and may not have been the employer's fault.
If they don't have proper insurance, it's an automatic "no". If they don't have any safety policies, they have the option to sign a waiver saying we (general contractor) will hold them accountable to our safety standards and manual.
Multiple citations, high incident rates, and a few others that are red flags, but it all needs to be evaluated on a case-by-case scenario in accordance with your subcontractor management program (SMP). We always furnish the subs with a copy of the SMP so they can see exactly what's needed, how they will be evaluated, what the scores mean, etc.

I like Drew, come from a very large corporate manufacturing organization. We are the largest manufacturer of hydraulic systems in the world. We had 280 manufacturing locations in the USA and many more world-wide.
As a matter of Corporate Policy many times our OEM customers demand we have certifications in ISO 9001 (Quality), ISO 14000 (most customers), and sometimes ISO 45000 or the new variants. Sometimes these certification requirements filter down to Tier II, II, and IV suppliers. In my experience if someone is ISO 45000 almost all of what Drew is talking about. The OEMS want to represent themselves as safe places to work and green places in the environment, so they expect ALL their venders to comply, even a small electrical contractor at one of our smallest plants!
In LEAN Toyota Philosophy, Contractor management is one of the major components of what is called "MoC" (Management of Change). FYI - the other component is the "New or Rebuilt Procurement Process and Approval" which builds Health & Safety when you begin the Procurement Process (You build Safety in at the start, not after you want to turn the machine on).
At my former Company EVERY Contractor has to sign a Work Permit at least annually to do any services in our plants. In the permit they agree to follow all of our EHS Policies even if they go above OSHA! They also agree to keep all their required EHS training current. Also SDS were to be supplied to us for approval for use in our plant PRIOR to them being brought in! Also the Project Manager was to meet with the Contractors and go over the work permit when they first discuss the work. The PM also met with with the Supervisor of the Contractor on the first day to obtain signed copies of our Safety Rules from every contractor's worker, that every visitor to our plant has to sign