Star Search: Finding the Right Contractor

Finding a mechanical contractor to deliver a successful project requires managers to do their homework

By Thomas A. Westerkamp  

Special Report: Mechanical Contractors

In conjunction with the affiliates of the Mechanical Contractors Association of America

Institutional and commercial facilities are in a constant state of change, and maintenance and engineering department budgets always seem to be tighter than the year before. Given these challenges, maintenance and engineering managers must be especially vigilant in making decisions on big-ticket equipment and projects.

Managers selecting mechanical contractors for facility renovations and construction projects will only be able to achieve department and organizational goals by screening contractor candidates carefully to ensure the chosen contractor can deliver on promises related to costs, schedules and work quality.

The process of finding the “right” contractor must include a review of the essential issues, including worker training, safety precautions, proof of insurance, experience and references from similar projects.

Setting the Stage

The spectrum of mechanical contractors available to managers includes companies that can meet specific needs, such as preventive maintenance (PM) for chillers, boilers, air-handling units, and air compressors. The options also can include umbrella agreements to provide labor, materials and supervision to maintain all mechanical equipment and systems.

For narrower purpose, specific language in the final contract should identify each asset covered and warranties. For example, who pays if a chiller breaks down during a heat wave after a contractor replaces it? Must the contractor pay only for the labor and material to make the repair, or is the contractor also responsible for interruptions to operations caused by the equipment breakdown?

Among the other types of available contract services managers might consider relate to building additions or modifications; in-house-crew augmentation during periods of heavy maintenance workloads, such as scheduled facility shutdowns; or during temporary backlog increases, such as when ensuring regulatory compliance with new laws.

Often, simply having certain maintenance personnel capability or a type of equipment on hand all the time does not justify its cost to the organization. For example, one facility contracted to have all service-entrance-wiring insulators cleaned annually during scheduled summer maintenance. This cleaning prevented arcing across insulators during storms, which could cause major damage.

But the organization had no other need for the skills to work with high voltage, or for the 30-foot insulated cherry picker to perform the task. So outsourcing was the most cost-effective and efficient strategy for this organization.

At the same time, the contractor also cleaned and exercised high-voltage circuit breakers and switches using a current generator to ensure that breakers tripped at the rated interrupting current.


Worker training has a great impact on the quantity and quality of mechanical contract work performed, not to mention on the safety of workers and occupants. So managers should pay close attention to this issue in selecting a mechanical contractor and keep it prominent in the project specifications.

Managers usually can do this by stating that the contractor agrees that workers assigned to a project have the necessary training and experience to perform the work and are familiar with and use current, techniques, equipment, tools, and skills required to accomplish the job. The contractor also should be required to maintain worker-training records signed by the instructor and the trainee. This step is also an OSHA requirement for safety-training certification.

Continuous-improvement training for a contractor's crew should be a part of the service, and it can be a selling point for a contractor because the improvements can offset part of the service expense and increase the value of the service. Adjustments for the lower cost and increased life cycle should be a part of the contract.

The amount of the adjustment might even take the form of a fixed price plus an incentive, where the contractor applies a percentage to the base fee proportional to continuous-improvement savings generated by the contractor. Managers should be careful in documenting the exact formula to be used to determine the amount of the incentive bonus due, if any, and how often the calculation is made.

Safety Precautions

Consider this scenario: A mechanical contractor on site is using a truck crane to lift a rooftop air-conditioning unit. An in-house project manager sees that the crew is not using blocks to lock the outriggers in position and informs the crew leader.

Nonetheless, the crew member fails to install the blocks because they are back at the equipment storage yard. As a result, the loaded crane tips and causes serious injury and damage.

Such incidents occur very frequently in many forms. They illustrate the need to have the right contractual understanding about responsibility, proper insurance coverage and responsibility for payment. But they also highlight the importance of frequent and thorough follow-up to ensure that injuries don't occur and that payment provisions never have to be invoked.

Proof of Insurance

Managers screening mechanical contractors can protect their organizations from liability by including language in the final documents that requires the contractor to provide a certificate of insurance from the contractor's insurer, including liability and worker's compensation insurance.

This insurance must be equal to or better than an owner's minimum requirements, and it must be current and submitted before the contractor arrives on the property. If the contract is long-term, the certificates should be renewed annually based on the term of the agreement between the insurance provider and the contractor.


Managers also will find it necessary to ensure that there is a clear understanding and agreement by both parties about the scope of work and the experience required to complete it successfully and cost-effectively. This step can ensure that mechanical contractors' crews have the right type and level of experience.

In the case of a mechanical contractor providing a broad scope of maintenance, the manager should provide a list of each asset covered in the agreement, including location, description, serial number, model number, type, warranty status and size. The owner also should provide a list, similar in detail to the covered list, for all items not covered by the contract.

Additionally, the covered list should contain the level of service and expected response time for each item. The description of the level of service should list all service included — emergency 24/7 service, as well as cleaning, PM, predictive maintenance, corrective maintenance, and periodic overhaul, including the manufacturer's report of condition before and after overhaul.

Once work-scope information is documented, the manager and contractor can specify the type of tasks, as well as the level of skill, whether it is just routine PM or troubleshooting.


A manager can never be sufficiently assured of a mechanical contractor's competence without researching the company's references. Too often, however, managers obtain the references but do not follow up on them.

A contractor should provide references for the type of work to be performed, and the manager should use due diligence in following up with contacts and visiting the premises where previous work was performed. This information enables managers to get a first-hand look at the quality and to interview that customer to ensure the contractor's qualifications and experience are appropriate.

The search for a mechanical contractor that matches an organization’s particular needs at particular times can be overwhelming, especially given fast-track work schedules and tight budgets under which managers operate with increasing frequency.

Gathering information on the contractor's references, worker training, safety precautions and proof of insurance are essential steps managers must take in making a sound business decision. Beyond those steps, however, managers have other actions they can take to help in the decision-making.

For example, managers can review the ways the in-house maintenance and engineering department stacks up against competition from any given mechanical contractor, as well as how contractors stack up against in-house capabilities. Such a review can provide insights into each one's complementary strengths and weaknesses. In each case, the winner is the manager-contractor team.

Contact FacilitiesNet Editorial Staff »

  posted on 1/1/2004   Article Use Policy

Related Topics: