Contractor Management: The Importance of Maintaining Contractor Compliance

Commercial businesses are liable for any work performed at their facility; therefore, maintaining contractor compliance is extremely important. Depending on the size of the location or the scope of work, managing those contractors can be a full-time operation. The manager responsible must ensure that the service professionals who perform work at the facility are fully compliant with state and federal regulations, as well as any company policy, code of conduct, or other terms and conditions. This is not only essential at the beginning of the project, but continues throughout the length of the contract.


Contractor management becomes a significant concern for the protection of businesses who hire non-employees to execute work operations at the facility. Maintenance workers, cleaners, electrical and plumbing tradesmen, or other contractors should be required to show proof of certain specific, government regulations compliance. Including, but not limited to, worker’s compensation insurance, proper licensing, and trade compliance certifications. Managing vendors and keeping track of the paperwork involved is stressful and difficult.

Companies that employ these contractors face certain challenges in contractor management. For instance, a commercial business contracts with a local roofing company to repair a leak, the roofer has proof of insurance and then agrees to the terms of the contract. If during the performance of the project, an OSHA inspector discovers any safety violations, the contractor and the facility face costly fines. The inspector may even halt all work progress until the violations have been corrected, which can cause lengthy and expensive delays.


Even if a contractor or service professional has held previous contracts, it is imperative that the company re-check all of the contractor information for each new job. If the work involved has a projected time span of over two weeks, periodic checks should also be performed, to ensure continued regulation compliance. To adequately protect business interests and for successful contractor management, constant vigilance is required.


Commercial companies need proper tools to assist in the management of service employees and contractors. When hiring, the company should provide a detailed statement of work in their bid solicitation. The statement should include the complete scope of work, copies of all the required insurance and licensing documentation, a request for Materials Safety Data Sheets (MSDS) for any chemicals used, and any special terms or conduct agreements. In particular, the MSDS information (if relevant) must be retained at the facility in accordance with applicable guidelines of the OSHA Hazard Communications Standard.


Vendor management systems like Fixxbook are excellent solutions for commercial businesses that need help cataloging and tracking numerous vendors and managing contractors, or for any company that requires a service. Look for systems that will record and list the commercial businesses requirements, such as statements of work, compliance agreements, and requisite company policy conditions. In addition to this, they should provide alerts when certifications expire, track trade qualifications, and ensure up-to-date insurance and legal requirements.

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