TORONTO TRANSIT COMMISSION REPORT NO. MEETING DATE: December 6, 2007 SUBJECT: PROCUREMENT AUTHORIZATION CONSULTANT SERVICES SUSTAINABLE SAFETY CULTURE

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1 Form Revised: February 2005 TORONTO TRANSIT COMMISSION REPORT NO. MEETING DATE: December 6, 2007 SUBJECT: PROCUREMENT AUTHORIZATION CONSULTANT SERVICES SUSTAINABLE SAFETY CULTURE RECOMMENDATION It is recommended that the Commission authorize the award of a performance based contract to Behavioural Science Technology Inc. (BST) for Sustainable Safety Culture services for a three year term in the fixed fee amount of $7,244, The contract is structured such that the consultant has reduced their standard fixed fee by 20% ($1,566,418.73) which will become a performance pay component. If BST does not achieve a greater than 40 percent reduction in the Lost Time Injury Rate (LTIR) at the end of the three year performance period, TTC is not required to pay any additional fees. If BST achieves between a 40 to 60 percent reduction in the LTIR at the end of the three year performance period, TTC is required to pay an additional lump sum amount of $1,566, If BST achieves a greater than 60 percent reduction in the LTIR at the end of the three year performance period, TTC is required to pay an additional lump sum amount of $3,132, Based on the performance achieved by BST the table below summarizes the total final cost of the Contract. Alternative < 40% Improvement % >60% Improvement Fixed Fee $8,811, $8,811, $ 8,811, Performance Based* $7, 244, $8,811, $10,377, * Recommended In addition, as BST is not licensed to collect Ontario Retail Sales Tax, the Commission will have to self-assess the 8% ORST on the software, which results in an additional $3, bringing the total amount to be authorized to $10,380, FUNDING Sufficient funds for the 2008 expenses are included in the 2008 TTC Operating Budget approved by the Commission at its meeting of November 14, Adequate provisions for

2 SERVICES SUSTAINABLE SAFETY CULTURE Page 2 future year s requirements will be included in future operating budgets. Reductions in the cost of workplace injuries are predicted to fully offset the cost of the Contract by year five. The estimate for WSIB payments has been adjusted in the 2008 operating budget. BACKGROUND Since 2002 the total number of workplace injuries at TTC increased from 2052 to 2743 and the more serious LTIR at TTC has risen from 5.20 injuries per 100 workers to We have not achieved our Corporate Occupational Safety Goal in the past three years and the trend continues upward in As a result, the number of work days lost to injury has climbed from 15,251 in 2002 to 20,826 days in the year ending September 30, This is equal to approximately 90 full time people losing a full year of work to injury. In addition to an increasing frequency of lost time injuries, the TTC has experienced several incidents in which employees suffered severe injuries including one fatality. The TTC and two supervisory employees have been charged under the Ontario Occupational Health and Safety Act in connection with one incident involving overexposure to carbon monoxide. An upward trend in injury frequency coupled with increasing severity cannot be tolerated in any organization. TTC management invests significant resources to identify root causes underlying serious incidents. These lead to management corrective actions to prevent recurrence of similar types of incident. The most serious of these are updated in periodic Commission reports. While management is confident that these corrective actions will prevent recurrence of these specific incidents, we have concluded that something more is needed. Late in 2006 interim Chief General Manager Gary Webster developed a Seven Point Action Plan to Transform TTC s Safety Culture. This Plan required all supervisors to take action on a broad front to improve safety performance. One year later we have a better grasp of our risks, safety competency has grown and we have a more responsive system to Joint Health and Safety Committee issues. Nevertheless, our injury rates have remained stubbornly high. Management has concluded that a more comprehensive approach is needed to embed safety as a value which underpins all of our business activities. Further, the skill set to undertake a sustainable transformation of safety culture is not available within TTC and there is a need to engage an external expert in the field. TTC staff arranged informational meetings with three of the leading firms in the field in the spring of TTC led a seminar on safety culture at the APTA Rail Conference in June. Representatives from the transit agencies in New York, Washington and Los Angeles presented their experiences with safety culture initiatives. On the basis of this information, staff prepared a Request for Proposal

3 SERVICES SUSTAINABLE SAFETY CULTURE Page 3 DISCUSSION A Request for Proposals was publicly advertised on the Commission s Web site as of July 10, Fourteen companies picked up copies of the proposal documents, out of which six submitted a proposal as summarized in Appendix A. The proposal validity shall expire on December 31, The proposal documents allowed the Commission the sole right to negotiate any aspect of the proposal submission including pricing. The recommendation for award is based on the highest rated qualified proponent with reasonable pricing. A total of 21 factors were considered in evaluating the proposals as summarized in Appendix A. Any proponent rated within 3% of the highest rated qualified company was considered equally qualified. However, since no submissions were within 3% this did not apply. All proposals received were reviewed and all proposals that appeared to be compliant were rated by the evaluation team. One proposal was considered noncompliant as it did not contain a signed Form of Proposal and was not evaluated The proposal submitted by BST scored much higher on the qualitative evaluation than any other proposal. In particular, the project work plan and methodology was spelled out in much more detail and the instruments and tools to be used were specific and appropriate. The project manager and project team demonstrated, based solely on the information provided, the best relevant experience and have performed work of this nature for other firms. Following determination of ranking and qualification of the proponents, the pricing envelope of BST was opened. It contained numerous commercial exceptions and staff entered into negotiations to reach an acceptable agreement. These negotiations resulted in revised pricing, acceptable payment terms and resolution or withdrawal of the remaining exceptions. Staff conducted a detailed cost benefit analysis which demonstrates that the project will be self financing in year five at either the 40% or 60% rate of reduction in LTIR as summarized in the table below (rounded $ million). 40% Reduction in Lost Time Injury Rate Cost Benefit Cumulative Net Return (1.84) (2.44) (2.50) (.39) % Reduction in Lost Time Injury Rates Cost Benefit Cumulative Net Return (1.84) (1.91) (4.05) (.89) 2.27

4 SERVICES SUSTAINABLE SAFETY CULTURE Page 4 JUSTIFICATION The substantial financial and time commitment required for this Contract is essential to change the values, attitudes and behaviour of TTC employees at all levels. Management has a duty to take all reasonable steps to ensure safety. The many programs and initiatives taken to date have not resulted in a satisfactory reduction in employee injuries and a comprehensive approach is needed to create a new cultural context for everyone. Improvements will be self financing through the reduction in costs associated with injuries. Beyond that, we anticipate improvements in productivity, morale and labour relations will be leveraged as spin off benefits to an enhanced focus on the safety of individual employees. November 22, Attachments Appendix A

5 APPENDIX A Consultant Services Sustainable Safety Culture P23PC07807 LIST OF PROPONENTS (in alphabetical order) 1. Behavioural Science Technology Inc. * 2. Celerant Consulting (Canada) Ltd. 3. E.I. du Pont Canada Company 4. F&H Solutions Group ** 5. IAPA 6. Nuclear Safety Solutions Ltd. * Recommended company ** Non-compliant PROPOSAL EVALUATION CRITERIA A. CORPORATE QUALIFICATIONS/EXPERIENCE Number of Years in Business Relevant Corporate Experience Large public transit or transportation organizations Relevant Corporate Experience Other organizations Depth of Available Staff B. PROJECT STAFF QUALIFICATIONS/EXPERIENCE i) Project Manager Number of Years Direct Experience Work of a Similar Size and Nature Technical Qualifications ii) Project Team/Subconsultants Number of Years Experience Work of a Similar Size and Nature Technical Qualifications C. PROJECT STAFF DEDICATION Key staff sufficiently dedicated to the Work Right mix between Senior Staff and Balance of Team D. UNDERSTANDING OF THE WORK Cultural Transformation for each level of the organization Expected benefits including quantifiable measures Employee Engagement Work Observation Accountability Specific Hazards Reporting Timeline for implementation TTC resource requirements