Health and safety compliance is like insurance. It takes an incident to prove why you must have it!
It is fair to state the larger construction enterprises are as health and safety conscious as they are ever going to get. They have the resources and funding to educate their workforce to a high standard, and they recognise the commercial and economic advantages to be gained by meeting their moral and legal obligations to create a safe working environment.
In contrast, health and safety compliance in small construction firms is often poor and sometimes completely absent. Our experience of working in the sector is far too many owners and managers of small firms cannot show any tangible evidence they have taken sufficient measures to meet their legal obligations in respect of ensuring the health and safety of those affected by their activities, which leaves them very exposed to higher penalties in the event of an accident and the ensuing prosecution.
Worse still … we continue to cross the paths of many workers who blatantly ignore the law because their collective experience to date allows them to perceive, no matter how misguided it may be, the chances of them being caught and prosecuted by either their employers, or the HSE, for non-compliance is so low it is not worth them bothering themselves with the little extra work involved to work safely. If it was only their continuing personal safety at stake, their errant attitude might be less of a concern, but as is often the case, it is somebody else who is harmed by their indifference.
Well it is time for those people to think again … because things are a changing.
Three factors explain why small firms need to take H&S more seriously. Firstly, the HSE keep indicating smaller firms can expect more random site-inspections in future. Secondly, the Grenfell Fire is already driving up the standards engaging firms demand their sub-contractors meet. Finally, insurance underwriters are increasingly requesting sight of documentary proof of H&S compliance for the business risks they insure. No proof, no insurance cover, no business.
We specialise in helping small to medium sized construction firms improve their health and safety compliance. Those firms who raise their game will prosper in the changing market place. Those that don't, will struggle to keep trading because they represent too much of a safety risk to engage, even by the private, home-owner sector.
More about MAAP Consultants
Where we've been: MAAP Accountants was founded in 1994 and continues as a successful and licensed accounting services practice in Christchurch. We have branched out over the years into software development and online interactive education. Six years ago we extended our interests in health and safety consultancy to the construction sector.
Consulting on accounting, tax-planning or health and safety only requires a change in the rule books one applies. The legislative regulation of H&S and accounting both spell out what we can and should not do. The enforcing agencies, HSE v. HMRC, work in exactly the same way … and everyone, it seems, would rather avoid complying with the rules if given the choice.
The one significant difference between the disciplines, however, is failure to observe H&S law means people are more likely to either suffer a serious injury or be killed in the workplace.
Last year 38 workers died as a result of construction site accidents in the UK.
In statistical terms, those 38 deaths represent a commendable endorsement of all the effort that goes into promoting H&S in the workplace, especially when you consider France's fatality rate was SIX (!) times higher.
Of course, to the families of the 38 individuals who lost their lives, it is a momentously tragic event with far-reaching consequences, for which expressions of our collective sorrow and sympathy for their loss has little comfort.
Furthermore, behind those fatality statistics, is a host of reported and unreported injuries that probably could have been avoided by observing better safe-working practices in the work place.
It is always a challenge to change a systemic contempt for H&S within an organisation once it has set in, but we have proven it can be done.
Improved compliance is good for business to. If you see two building firms renovating a property in the same street and only one has put up Harris fencing and appears to be operating to a high standard of H&S, does that not suggest there may also be a difference in their respective ability to deliver a reliable construction service as well?
Where the sector is going next: We believe the wise small firm owner should anticipate and start acting now to meet the raft of new regulations that will arise from the Grenfell Inquiry. We also wholeheartedly support Dame Hackitt's continuing campaign to put an end to the race to the bottom in standards prevalent throughout the building sector.
Many small firms at the bottom of the supply-chain will find it increasingly harder to secure new work because their customers will become much more selective about who they engage in future. This will be because each level of contractor will be under increasing pressure from their clients and their insurers to only appoint verified competent and compliant contractors.
The promise to mend your ways and improve compliance in the future will no longer be an acceptable benchmark to procurement managers who have to prove they have carried out a belt-and-braces review of your competency and compliance history.
Firms who cannot 'prove' their competency by way providing evidence of suitable and sufficient training for their workers, underpinned by credible and complete written records of past H&S compliance, are far too a high insurance risk for anyone to contemplate engaging.
If the HMRC's making-tax-digital (MTD) scheme is not enough of an extra administrative burden to deal with over the next few years, one of the anticipated consequences of the Grenfell Fire Inquiry is small firms will also have to demonstrate a much higher standard of safety compliance to their insurers.
The number of H&S audits being carried out on smaller firms by their insurers is already on the increase. It goes without saying that a firm faces a very serious operational continuity problem if their insurer qualifies, or withdraws, their cover as a result of any unsatisfactory audit outcome. The reality is it could put them out of business overnight.
Retrospective legal actions being brought against small firms for unsafe working practices and poor workmanship are on the increase, which only serves to highlight the generally poor standards the sector has previously worked to.
Many small firms have yet to understand the legal implications for them of the Construction (Design and Management) Regulations 2015 (CDM 2015). Prior to 2015, many of the statutory acts and regulations exempted work carried out on domestic homes owned by private individuals.
With the advent of the CDM 2015, the activities of every man-with-a-van in the building trade now falls within the scope of these regulations. The artificial 'five employee' rule requiring H&S systems to be documented still applies, but the CDM 2015 effectively means the way a small firm operates and the professional building standards they achieve, especially with respect to fire safety, will be judged by the same yardstick as larger corporate construction firms.
By way of example to highlight the above point, consider many large property controllers insist every time a utility is led through a compartment wall in one of their buildings, a bar-code sticker is placed next to the hole to identify the nature, manufacturer and date of installation of the surrounding caulking material used to seal the breach for fire safety regulations.
One can easily imagine the consternation of a small firm contractor to a request from one of their clients, or a home-owner, to adopt the same approach.
The gulf between the professional standards of care exercised by large and small firms is enormous and the main reason why that difference exists is because of the available funding. Unfortunately, a fire will not differentiate between a professionally installed fire break that holds it back for the required 30-minutes and one that fails within seconds because it was fitted by a well-intentioned but essentially ignorant and therefore incompetent fitter.
If you need a reason why standards have to be improved across the sector, think about how confident you are the correct fire-stopping has been applied in walls in the home your family will go to sleep in tonight. Unless you built the home and know you met the fire regulations it is is unlikely you will determine compliance without intrusive sampling.
The way small builders work in terms of what is 'reasonable and practicable' has to be reconciled with the higher safety standards operated as a matter of course by the larger firms.
According to the CITB, 90% of the construction trade sector is made up of 200,000 construction firms who employ less than 10 people.
There is no doubting the majority of these small firms aim to deliver a high standard of professional service to their customers. They are also run by people who concede they do not possess the aptitude, time or funding to access, understand and sensibly apply all the complex law and building standards they must comply with on a day-to-day basis. Something has to change!
The more astute will recognise the commercial opportunities that will arise from improved enforcement of building standards and higher penalties for non-compliance that will inevitably come about post-Grenfell. MAAP is already developing innovative and affordable systems to help small firms and their customers prepare for the coming changes and prosper under the new regime.
If you are looking for advice on H&S matters from a professional agency that works to the exacting standards reserved for a licensed firm of accountants … then we look forward to talking to you. Please call and ask to speak to one of our health and safety consultants on 01202 474001.