The CDM Regulations 2015 has introduced changes in the management of health and safety within a project, with additional client obligations and most fundamentally, the introduction of the “Principal Designer” role to wholly replace the CDM Coordinator role.
A Principal Designer must be appointed, in writing, where there is, or is likely to be, two or more contractors (which includes trades) on site. In reality, this will encompass virtually all commercial projects, and many domestic projects (which now also fall within the ambit of the Regulations). There is a transitional grace period to 6 October 2015. This article focuses on the risks and issues of the Principal Designer role, and how these can be mitigated or dealt with.
A Principal Designer must be a designer with control of the pre-construction phase, and must have the skill, experience, knowledge and organisational capacity to undertake the role (whether in-house or via sub-contracting). The use of the word “Designer” reflects the intention that this role be undertaken by a “designer” within the meaning of the CDM Regulations 2015, (although this is broadly defined to include those involved in the design and may include, for example, the client). However, this import of the word “Designer” in this new role has led to unintended confusion and misconceptions on the intended scope of this role. The Principal Designer does not carry out design work, although he may be undertaking design work in a different role (such as architect or D&B contractor). The Principal Designer, in simple terms, acts as co-ordinator and project manager to ensure the project’s design and designers comply with the CDM Regulations 2015. It is not however an identical role to the CDM Coordinator, but a new replacement role. Whilst former CDM coordinators are seen to be appointed as sub-consultants for this role, the requirements of a Principal Designer to be a designer with control of the pre-construction phase means that a former CDM Coordinator would be unlikely to satisfy this criteria in practice.
The Principal Designer’s scope of responsibilities in the CDM Regulations 2015 is widely drafted, and the importance of formalising a suitably worded appointment should not be overlooked. There are also additional related pitfalls, such as clients who may seek, by way of the contract, to pass down some of their own new CDM obligations.
Nonetheless, anecdotal evidence overwhelmingly suggests that clients are appointing a Principal Designer by way of a single sentence in their existing appointment or contract, confirming they are the Principal Designer for purposes of the CDM Regulations 2015 and will comply with their obligations accordingly. The risks and issues for those appointed in this manner should not be ignored.
What risks and issues does the role bring?
There is, and will remain for the immediate future, some lack of clarity about how the statutory duties of a Principal Designer are to be interpreted and applied in practice. These new, additional obligations necessarily bring new, additional risks of liability – potentially for no extra fee.
There is the obvious lack of skill and experience of many consultants who are requested, or in many cases, required, to undertake this role by their clients. In this regard, it should be noted that the CDM Regulations 2015 place an obligation on clients to only appoint a party, and a corresponding obligation on the party to only accept an appointment, which falls within the CDM Regulations 2015 (i.e. including Principal Designer, Principal Contractor, designers, etc) where the party has the skill, knowledge, experience and, where an organisation, the organisational capacity, to fulfil the duties under the Regulations.
In addition, the role of a Principal Designer extends throughout the project, not just the pre-construction phase (although the bulk of the role is expected to take place then). This is relevant when considering the contractual matrix of the parties, and, for example, potential novations of the design team to the D&B contractor.
It should not be simply assumed that a party’s professional indemnity insurance covers this new role. For example, the scope of the professional indemnity may be strictly limited to architectural services, and the Principal Designer role arguably falls outside the typical services of an architect. We have heard of at least one major consultant who is refusing all such appointments on the basis that it is not covered by their professional indemnity insurance.
Finally, there is the risk of criminal liability via prosecutions. There are no specific criminal sanctions listed within the CDM Regulations 2015. Therefore, the sanctions are governed by the Health and Safety at Work Act 1974. The penalties range from imprisonment (12 years – 2 years, depending on the breach and mode of trial), or a fine (up to £20k, or may be unlimited for health and safety offices committed after March 2015). Currently, there have been no prosecutions under the new CDM Regulations 2015. However, there are various examples of fines being imposed for breaches under the CDM Regulations 2007.
Are there new strict obligations?
There is also the issue of the requirement to “ensure” in some of the statutory duties (see in particular Regulations 11(4) and (5)). On first reading appear to be strict obligations. Regulation 11(4) has caused particular concern among potential Principal Designers, as it states that a Principal Designer “must ensure all designers comply with their duties in regulation 9”.
However, these obligations are expressly stated to be carried out in fulfilling the overarching duties in Regulation 11(1) which in turn are expressly qualified by “so far as reasonably practicable”.
We have been informed that the HSE have confirmed to the Association for Project Safety and RIBA that this indeed does qualify the obligations, i.e. to “ensure” only “so far as reasonably practicable”. The duties of a Principal Designer are not intended to be absolute obligations. This seems sensible as it would be highly difficult, if not impossible, for a Principal Designer to completely ensure that other designers comply with their CDM duties.
The standard of “so far as reasonably practicable” enables a Principal Designer to balance time, cost and other project considerations with their duties, in order to take the most appropriate course of action in the circumstances.
What are the standards?
So there is the applicable standard of “so far as reasonably practicable”.
There are also the General Principles of Prevention in the CDM Regulations 2015, which must be taken into account by the Principal Designer. These are, in reality, remarkably obvious and common sense health and safety considerations and compliance with them should not cause any undue hardship.
How can you minimise or mitigate the risks?
Before accepting the role of Principal Designer, a party must ensure they have arrangements in place, either in-house or via a suitably qualified specialist sub-consultant (likely a former CDM co-ordinator) to fulfil this role. The appointment of the sub-consultant should, ideally, be back-to-back with the main Principal Designer appointment. This is particularly vital where the party lacks the speciality in-house and is relying wholly on their sub-consultant. On the same vein, are there additional advisory services they will require from their sub-consultant to ensure they have the processes and procedures in place to minimise any potential issues and maintain all necessary records to illustrate fulfilment of this role?
If faced with a detailed schedule of service, one should not assume that it mirrors the statutory obligations, but check that this is indeed so. We have witnessed schedule of Principal Designer services which in fact extend beyond the requirements of the Regulations. Whilst there is nothing wrong with making such a commercial agreement, a party should be fully aware of the terms they are entering into so they can be sure they are happy with the position, are able to fulfil them, and indeed have allowed an appropriate fee.
Appropriately worded caps and limitations are important, in particular to make it clear that the Principal Designer is not undertaking a designer role (although they may also be a designer) and its involvement in the designers’ designs is strictly limited to the issues of health and safety. This clarity will also avoid unnecessary disputed bred from misunderstanding of the employer on the scope of this new role. As mentioned above, the HSE appear to accept that the Principal Designer duties are qualified by “so far as reasonably practicable”. However, until official guidance is issued to this affect, cautious professionals may wish to expressly confirm their duties are so qualified insofar as they can obtain agreement to such a qualification in their appointment.
It is vital to check one’s professional indemnity insurance cover. An initial conversation with the insurance broker is the best starting point for this, explaining the scope of the new role so they in turn can make enquiries and seek confirmation of the position from insurers.
Finally, a Principal Designer should ensure that the correct internal and project processes are in place, such as regular risk assessment reports and meetings, risk register and records of checking procedures to facilitate practical and efficient compliance, as well as forming documentary evidence of such compliance, of the Principal Designer duties.
It is also important not to forget to read the HSE general guidance on the Regulations, and the CITB specific guidance for each role. In contrast, there remains an absence of detailed amendments to the commonly used standard form contracts. General guidance has been issued specifically for NEC contracts, albeit without proposed contract terms. Conversely, JCT and PPC2000 have issued basic amendments to reflect the new Regulations, such as changing CDM 2007 references to CDM 2015 and CDM Co-ordinator to Principal Designer, but without detailed guidance. All of these are available for free online. Whilst not binding and self-evidently requiring further contract amendments (such as those covered in this article), they are helpful to understand the philosophy that will be applied by the HSE in particular, and will likely be taken into account by a court or other tribunal in seeking to apply the appropriate interpretation of the Regulations if and when a contractual dispute or criminal proceedings arise.