Latest News

Why is CoR compliance different in the construction sector?

July 27, 2017

Recent media reports about the $16.8 billion WestConnex project in Sydney highlight the enormity of Australia’s largest infrastructure undertaking, especially when you consider about 1 million cubic metres of sandstone have already been removed and trucked to housing development sites in the city’s west.

And still, only about 70 per cent of the excavation for the 5.5-kilometre motorway tunnels has been completed.

The WestConnex M4 East project is estimated to involve approximately 170,000 truck movements associated with soil removal alone, without taking into account equipment movement and delivery of construction materials.

According to Nathan Cecil, a transport lawyer at Holding Redlich and regular contributor to CoR Adviser, the concentration and sheer scale of activity across the construction sector make Chain of Responsibility (CoR) compliance and safety risks unique.

“Major construction projects can have hundreds of truck movements per day. Managing such volumes of heavy vehicle movement is a logistical nightmare,” he says, adding that complexity of operations adds significantly to the management of CoR compliance on such large-scale projects.

He notes that if compliance is not managed properly on large-scale construction projects, the regulators will come calling.

Nathan says that in NSW, Roads and Maritime Services (RMS) representatives have previously identified the construction sector and civil contractors as having limited awareness of CoR compliance requirements and low implementation of CoR compliance practices, saying:

“With a significant increase in the number of infrastructure projects taking place across the state, it is crucial heavy vehicles being operated as part of these projects are compliant with road transport law and any associated risks are properly managed”.

RMS also indicated that the increase in infrastructure project activity would bring with it: “targeted enforcement… to change industry culture and practices”.

You have been warned!

“We have seen this in practice, with police operating targeted enforcement campaigns on trucks servicing almost every significant construction project in recent history. The concentration of heavy vehicles makes enforcement action much easier – it’s like shooting fish in a barrel!” says Nathan.

Mitigating risk

As part of project risk mitigation, Nathan says principal contractors and transport operators are usually required to submit a CoR management plan to project stakeholders, either as part of the tender process and/or before being permitted to commence any work on a project.

“Project stakeholders, including private developers and government agencies or corporations, want assurance that principal contractors awarded the design and/or construction work will properly screen and manage the compliance of subcontractors that will be performing the work.

“Principal contractors want assurance that the subcontractors they engage to perform the work can either comply with the project CoR management plans or have in place or design their own CoR management plans. They don’t want subcontractors to expose them to breaches and potential penalties under the design and construction award,” he says.

Subcontractors, including transport operators, equipment suppliers and construction material suppliers, need to be able to demonstrate that they have in place working practices to ensure they – any further subcontractors engaged down the chain – are compliant with the project CoR management plan, Nathan adds.

A final warning

Nathan says that maximum penalties for some breaches are to rise to $3 million for corporations and $300,000 for executive officers in mid-2018, hence non-compliance could have a significant impact on project return. In addition, if non-compliance were to result in the grounding of major contractor fleets, project disruption and delay would be inevitable and extremely costly.

For all the latest CoR information, including regular, in-depth articles from Nathan, subscribe to CoR Adviser. The monthly newsletter is the best place to find all your CoR-related news and legal updates, information you won’t read in the daily press.

Subscribe today.