Why Focusing on Contractor Compliance is Important

by Eric Schechter   Oct 01, 2013

Contractor Compliance, Contractor Management

Why Focusing on Compliance is ImportantIn this distributed-asset world that we live in, we are starting to see a need for a level of compliance and control that has just not been there previously. For some companies, it is a real culture shock having to focus on contractor compliance. It can be considered a bottleneck: because if they were doing it, then they were doing it very inconsistently. Now facilities managers are saying, “Before a contractor can send out an employee and work on my equipment, I first need your insurance, license, references, rates; I need background checks,” - all this stuff.

In a lot of cases contractor compliance is looked at as a barrier. But it’s just the opposite, because now they have this great tool - they can get organized proactively and establish all the requirements for work (using this great network we’ve built: Fixxbook). That way when something happens at their facility, they already have all of this documentation in one place. And best of all, facilities managers can immediately dispatch service whether they are using our work order dispatch system or another.

Streamlining the Contractor Vetting Process

A client who is hiring contractors is the one who typically establishes the contractor requirements. Examples of these are:

  • Terms and Conditions
  • Code of Conduct
  • Insurance
  • A Non-Compete, etc.

Our software application will electronically compile all of a facilities manager's requirements. From there, they can invite their existing contractors to go through the compliance process. They can access our network of over 50,000 contractors, identify those who meet their needs and invite them to meet their particular compliance requirements.

Once all documentation is in the system, the client knows that they are using contractors that are in compliance. If a contractor falls out of favor, they are notified and it is addressed. That is how the system works, and it works very effectively.

If they're using Private Network, facilities managers can invite contractors to join their list of approved vendors where they will see exactly what that company requires. Contractors can review and agree to all requirements as well as submit any required documentation. At this point, they are ready to be vetted and someone needs to verify that all of the information that the contractor has provided is true and factual. There are two options for this:

  1. Some clients choose to do the vetting themselves. They can call the insurer to see if a policy document is valid. They can go on the Internet to check for their state license for the trade that contractor is in. The client can choose to pay for this vetting themselves or they can require for the contractor to pay for the vetting.
  2. We also have a strategic partner in risk management, who can do the vetting for them, for a fee.

Once the vetting is done, a facilities manager can accept or decline working with a given contractor. If they accept that contractor, they are what's considered an Active Contractor in the facilities manager's network. Now the system monitors all of those relevant documents. If the terms and conditions expires on a certain date, the system will know that. If a contractor's insurance coverage is going to expire on a certain date, the system will know that as well. There are about 15 different elements of a contractor's file that the Private Network system monitors for compliance.

Think about how you’re managing compliance today. And then think about how technology has affected so many other aspects of business and personal life. Why would you not use technology to manage your contractor compliance?

Eric Schechter
President, Fixxbook
[email protected]

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