Internal vs. external health and safety resource: The pros and cons for Principal Contractors
To outsource or not to outsource, that is the question, and it is one every principal Principal Contractor must answer when considering their approach to the management of health and safety. There is a statutory requirement under the Management of Health and Safety at Work Regulations 1999, that every employer shall appoint one or more competent persons to assist them in undertaking the measures they need to take to comply with the requirements and prohibitions imposed upon him by or under the relevant statutory provisions and by Part II of the Fire Precautions (Workplace) Regulations 1997.
Principal Contractors have two main options to discharging this duty, they can employ somebody internally to fulfil this role, or they can partner with a health and safety consultancy. At Havio we’re naturally slightly biased towards the second option, but the truth is there are positives and negatives with both solutions, and the right approach ultimately depends on the individual contractor’s needs, priorities and company culture.
To help contractors make the decision that’s right for them, here are some of the pros and cons of working with both internal resources and external consultancies, starting with the cost.
Comparing the costs
On a cost per hour basis, employing an internal resource will inevitably be cheaper than outsourcing to a third party. The salary of even the most qualified and experienced health and safety manager is unlikely to come close to a consultancy’s hourly rate.
But a contractor’s health and safety needs are often variable, with periods where resource isn’t needed at all. With a permanent employee they may end up paying for downtime, where services are simply not required. Depending on the continuity of a contractor’s business, the type of projects it works on and the number of projects running concurrently, a full time internal resource could easily work out more expensive than a consultancy on a monthly or yearly basis. There are also additional costs to consider such as recruitment, training, technology fees, and cover for sickness or annual leave.
A health and safety consultancy may be more expensive on an hourly basis, but it is also likely to be more flexible, only charging for time spent on that account which can work out cheaper overall. All costs are included in the rates, so there are no unexpected expenses, and contactors often gain access to complementary services that deliver extra value.
But even with consultancies there are pitfalls to avoid. Some charge inflated rates or take a one-size-fits-all approach to pricing. This means contractors aren’t just paying over the odds, they’re paying for services they don’t use. There are also consultancies offering exceptionally cheap rates, but their service levels are correspondingly low. If contractors do outsource health and safety management, they should look for a consultancy with a bespoke service and flexible costs, so they pay a fair price for the services they really need.
Reflecting on reliability
One of the key benefits of employing an internal health and safety resource is reliability. They are always available when needed, assuming they’re not on leave, and have full visibility of the build programme so they can schedule activities according. Flexibility and out of hours support can be a part of their job description ensuring a reliable and consistent health and safety provision.
With consultancies, reliability is more variable. Some are incredibly dependable and deliver exceptional service, guaranteeing there is always someone available to support when needed. But this isn’t a universal approach. Small one-man band operations won’t necessarily have the resource to cover call-outs and last-minute requests. On the other hand, large corporate consultancies tend to spread resources relatively thin across large numbers of accounts, which can also restrict reliability. If outsourcing, contractors should thoroughly check a consultancy’s service level agreement.
Prioritising the personal touch
Another good reason to employ an internal resource is the potential to receive a personal service. An employee should thoroughly understand the business, its ways of working and its company culture. Because they are viewed as part of the team there may be less resistance to their involvement from on-site teams. Of course, there is a downside to this. An internal employee can become too close to the project and be overly influenced by personal and political relationships, making it difficult to be impartial. There is also a risk of financial resources being stemmed and complacency setting in.
A consultancy is far more likely to remain professional and unbiased. Smaller consultancies may also take the time to build trusting partnerships with their clients and understand their business values, which helps to maintain frictionless relationships on site. This isn’t always the case with larger consultancies which sometimes lack the personal touch, applying a tick-box approach which results in on-site tensions. If using a consultancy, contractors must ensure it is a good cultural fit with their business.
A key downside of an internal resource can be lack of knowledge and experience, especially if they are recruited internally from a different role. Even if a Principal principal contractor recruits externally for an experienced professional, any further expansion of their expertise will be limited to the contractor’s own projects. Of course, knowledge can be expanded through training, particularly in specialist areas such as working at height or fire safety. But keeping pace with a dynamic industry through training alone can be tough as the individual won’t know what they don’t know.
A consultancy usually has the upper hand with experience. Consultants are constantly expanding their knowledge and can bring learnings from other current projects. As consultants work in teams, they continually learn from one another, and can draw on specialist expertise from across their organisation. Of course, knowledge is most valuable when it is shared and used for everyone’s benefit, so contractors should look for a consultancy that works collaboratively with its clients and explains health and safety matters clearly, without jargon or condescension.
In terms of liability, using an internal or external resource doesn’t make a difference. Principal contractors retain the legal duty to manage health and safety throughout their organisation, even if they get help from an outside consultancy. However, using a consultancy will reduce risk through increased awareness, knowledge, experience, and it also demonstrates a commitment to health and safety that reflects well on the company, helping contractors win bigger and more prestigious projects.
Ultimately the decision over whether to use internal or external resource should be made by analysing the individual organisations unique needs and determining how best these can be met. At Havio we try to provide a middle ground, where contractors benefit from a flexible, bespoke service, exceptional reliability, professionalism with a personal touch and ever-expanding knowledge and expertise. Feel free to check out our case studies to see what our clients think of our approach.