Safety incentive and penalty provisions in Indian construction projects and their impact on safety performance

Safety incentive and penalty (I/P) provisions in construction contracts are one of the most common forms of I/P. Contradictory opinions on the effectiveness of these provisions have been expressed in the literature. Statistics on safety provisions were collected from 32 construction projects, which include both types of contracts – those with safety I/P provisions and those without them. Although inclusion of safety I/P provisions in contracts helps in improving the overall safety performance in construction projects, further scope for improvement still exists. Literature review and structured personal interviews, coupled with a survey based on preliminary questionnaire, revealed that successful formulation and implementation of such provisions are dependent on 25 attributes which need the attention of both clients and contractors. A questionnaire-based survey was conducted to evaluate these attributes. The six factors extracted by carrying out factor analysis are: incentive distribution method, proper labour training, special attention to risky situations, role of safety committee and sub-contractors, specialised works and safety equipments, and right form of I/P. If taken care of, these attributes have the potential to improve the safety performance in construction projects. The results would be useful to clients and contractors in implementing the safety I/P provisions and thereby improving safety performance.