After much debate, countless consultations and numerous redrafts, the Construction Design and Management Regulations 2007 (the Regulations) hit the statute books on 6 April 2007. In this article we consider the impact the Regulations will have principally on the power generation sector, although of course the Regulations have a far broader remit.
The scope of the regulations
As the title may suggest, the Regulations apply to construction work, widely defined so as to include building, civil engineering or engineering construction work, as well as alterations, conversions, fitting out, commissioning, renovation, repair, upkeep, redecoration and certain cleaning operations. Perhaps less obviously, the definition also includes demolition, decommissioning and dismantling of structures. With particular reference to the power generation sector, “construction works” will certainly encompass buildings, structures comprised of metal and/or concrete, tunnels, shafts, gas holders, roads, masts, towers and pylons.
Interestingly preparation for construction works is also caught, meaning that site clearance, investigation and excavation may, in certain circumstances, require compliance with the Regulations.
In common with the 1994 Regulations that they replace, the new Regulations lay obligations on all parties to construction projects, in particular:
- Clients – those who either carry out their projects themselves or instruct or accept the services of others to carry out a project on their behalf.
- CDM co-ordinator – responsible for advising the client on its obligations under the Regulations and ensuring co-ordination and co-operation in respect of health and safety amongst those working on the project. Similar to the planning supervisor role operated under the old regime.
- Principal contractor – takes on wide ranging obligations including co-ordination of contractors, provision of information to those working on the project and the drafting of site rules.
- Contractor – anyone who carries out or manages construction work.
- Designer – those designing or modifying designs for construction work, including structures, products and mechanical and electrical systems.
Specific application to the power generation sector
A new build station is a primary example of a scenario in which the commissioning company will, in all likelihood, take on the role of the client. In a significant departure from the previous Regulations, companies in this situation can no longer delegate their responsibilities to an agent appointed to manage the project on their behalf. Instead, during such a project that company must:
- Appoint a CDM co-ordinator and a principal contractor, verifying their competence and resources as well as those of other appointees and sub-contractors. Failure to take such a step may result in the commissioning company being deemed to have assumed these roles for which it is unlikely to hold the requisite competencies to discharge the obligations to the satisfaction of the HSE, who are likely to be particularly attentive to such large undertakings, assuming that they have been notified as required.
- Provide pre-construction information to designers and contractors, together with health and safety for collation by the CDM co-ordinator.
- Ensure appropriate management arrangements are in place, including a suitable construction phase plan.
- Take reasonable steps to check the competence of contractors and sub-contractors. What is deemed “reasonable” will depend upon the size of the project and any specific risks associated with it. That being the case, the duty upon a power company building a new station will be much more onerous than in the case of most average scale construction projects.
- Allow sufficient time and resources for completion of each stage.
- Retain and provide access to the health and safety plan.
The challenges facing power generation companies seeking to build new stations is considerable. Industry associations, such as the Association of Electricity Producers or the Energy Networks Association, have a role to play in developing an accreditation scheme for contractors who work within this sector. Whilst the commissioning company could not rely entirely on membership of such a scheme when checking contractors’ competence, it will undoubtedly be an important part of the overall due diligence process. In contrast, where work is taking place on an existing station and the owner of the station is not also the operator, the identity of the client will depend upon a number of factors. The primary determining factor will be which company is commissioning the works, with the client responsibilities likely to rest on that entity.
Another relevant factor in such circumstances will be the control arrangements in any lease. If a lease imposes repairing and maintenance obligations on one of the parties and that party assumes that responsibility, discharging that role may constitute “construction work” for the purposes of the Regulations, triggering the regime they impose.
It is probable that some of the work carried out during outages will also engage this new Regulatory framework, although its impact may be mitigated by separating the outage work into several distinct projects. In order to do this, power generators should consider carrying out work in different departments or on different pieces of plant.
The reality of the Regulations is that it will not always be entirely apparent when they apply. Guidance can be found in the Approved Code of Practice, which should be consulted at least initially on all occasions when sizeable works are to be carried out. For example, substantial dismantling or alteration of fixed plant which is large enough to be a structure it its own right, (for example structural alteration of a power station generator or large boiler) will be “construction work” for the purposes of the Regulations as will the high pressure cleaning of parts of the plant.
Further, regardless of whether the project is notifiable or not, the client will always be responsible for checking competency and resources, ensuring suitable management arrangements are implemented, the provision of pre-construction information and for allowing sufficient time for the completion of all stages of the project. These responsibilities are then compounded when dealing with notifiable work, when the client must begin to appoint a CDM co-ordinator and principal contractor in addition to satisfying the other duties outlined.
Getting it wrong
Although the sanctions that can be imposed under the Regulations are initially relatively modest (£5,000 when sentenced by the magistrates’ court), in reality, power generators are likely to find themselves before the Crown Court where breaches have occurred. This opens the company up to an unlimited fine.
However, our experience suggests that, on the whole, the HSE tend to shy away from specific regulatory prosecutions, instead preferring to cite alleged breaches of the current CDM Regulations as particulars in proceedings brought under one of the general duties outlined by the Health and Safety at Work etc Act 1974 (HSWA). This automatically raises the bar in terms of financial penalty, with a £20,000 maximum available to the magistrates and an unlimited fine in the Crown Court. Additionally, HSWA provides the opportunity for the regulators to pursue employees (including senior managers) and directors, and such cases are on the increase in line with the increased public thirst for corporate and personal accountability.