Contractor Compliance Conundrums

two contractors in hard hats look at information on a tablet device

While facilities managers are often expected to be a jack-of-many trades, it’s not possible to be a jack of ALL trades. As such, engaging contractors becomes a critical part of the role.

In a world of evolving regulatory requirements and liability, the list of compliance checks required for working with contractors continues to grow. These regulations of course, exist to create safer work environments for all.

However, as the number of metaphorical balls we have to keep in the air increases, so too does the chance of dropping one.

These are some of the common compliance considerations when it comes to working with contractors.

What do we mean by contractor compliance?

Whenever your organisation engages a contractor, there will be a set of requirements, from various bodies, that the engagement needs to align with. These requirements follow a hierarchy of Federal, State, Local, and Organisational policies.

When we talk about compliance in this context, we’re talking about whether an engagement between your organisation, and an external contractor, aligns with recommended standards.


Much like many corporate roles, a person can study to achieve a qualification in a trade. However, while in some other professions, these accreditations are not just a nice to have, but a compliance requirement.

Contractors can obtain accreditation by proving to the Federal Safety Commissioner that they are adhering to best practice workplace health and safety systems and practices.

To check if a contractor is accredited, you can look them up on the Federal Accreditation Register.


Like accreditations, each state will regulate which trades require specific licences to conduct work. As with accreditation, licences are specific to the state, and nature of the work being conducted.

Contractors performing work must hold a licence of the appropriate class and type for the work they are performing.

You will be able to check the validity of a contractor’s licences by looking up their licence number. Licences are administered at a state level, so look up your state’s building authority for the relevant register.  


In Australia, workers compensation insurance is required by law for anyone with employees. When formalising agreements with your contractors, it is critical to ensure that they are appropriately covered by workers compensation insurance.

In addition to workers compensation insurance, contractors may also be required to purchase public liability insurance.


Inductions help to ensure that anyone conducting work in your facility is aware of potential hazards and risks. Before a contractor conducts any work, they must go through the necessary training in line with company policies.

Inductions need to cover certain things, such as hazards and risks, safe work practices and work health and safety legislation.

You may have multiple layers of inductions at your facility. For example, you might have an initial induction, an induction for specific equipment or spaces, and a take five procedure.


Depending on the nature of the work to be conducted, you may also have to implement a Permit to Work system. This administrative process ensures that contractors performing non-routine work have been made aware of any potential hazards, and necessary precautions.

Permits to Work might be necessary if the work to be conducted involves heat, heights, chemicals etc. In situations where risk is elevated, a stringent Permit to Work system can help to reduce the risk of an incident occurring.