The principal contractor’s joint and several liability for its subcontractors’ violations of safety regulations is the reason why the CAE generates so much documentation. In other words: when something goes wrong at a construction site or facility where several companies are working simultaneously, the contracting company cannot wash its hands of the matter by claiming that the accident involved subcontractor personnel. If the coordination documentation was not in order, responsibility extends up the chain of command.
This article explains what the CAE is, when it is mandatory, what documentation must be exchanged based on each company's role, and what the consequences are for noncompliance.
What is Business Activity Coordination, and when is it required?
The coordination of business activities is mandatory whenever two or more companies operate at the same workplace. This includes the principal company, contractors, subcontractors, and self-employed workers. This obligation stems from Article 24 of Law 31/1995 on Occupational Risk Prevention and is further detailed in Royal Decree 171/2004.
Royal Decree 171/2004 distinguishes three roles with different obligations: competing companies, which must inform each other of the risks they pose; the company that owns the facility, which also reports on the risks specific to the facility and issues instructions; and the principal employer, who monitors contractors’ and subcontractors’ compliance with regulations and requires proof of risk assessment, planning, and worker training and information.
One point that many companies overlook: The obligation exists even if the companies are not physically present at the same time. A cleaning company that enters an office outside of business hours continues to be subject to CAE obligations because it may be exposed to risks at the facility (electrical systems, stored products, evacuation routes).
What documentation must be exchanged between companies?
The regulations do not provide an exhaustive list of documents, but established preventive practices and the interpretation of the Labor Inspectorate set forth certain minimum requirements that every occupational safety and health manager must be familiar with. The level of documentation required must be proportional to the level of risk associated with the contracted activity.
Risk Assessment and Health and Safety Plan
The contractor must provide the prime contractor with its occupational risk assessment specific to the activity to be carried out at the worksite, as well as the health and safety plan when applicable (construction projects subject to the (RD 1627/1997).
Medical Fitness and Occupational Safety and Health Training for Employees
Every worker entering the facility must provide proof of a valid medical clearance and occupational safety and health training specific to their position and the hazards at the workplace they are entering. The prime contractor is required to verify this documentation before authorizing access, not afterward.
The downloadable checklist at the end of this article lists, by role, the minimum documentation that each party must prepare and verify.
CAE on Construction Sites: Coordination Between Contractors and Subcontractors, Common Challenges
In construction and engineering projects involving multiple companies working simultaneously, the CAE becomes a highly complex documentation process. In 2025, errors in subcontractor coordination continue to result in penalties for many companies—ranging from expired certifications to uncontrolled access and inadequate training.
The three most common bottlenecks are the outdated documentation (certificates that expire without anyone noticing), the lack of traceability (inability to prove that the documentation was verified prior to access) and the incomplete subcontracting chain (The prime contractor verifies its direct contractor but not its second-tier subcontractors, who also give rise to CAE obligations.).
What happens if a company fails to comply with the CAE? Penalties and liability
Failure to comply with CAE obligations may result in serious or very serious violations under the LISOS, with penalties ranging from 2,046 euros to more than 819,780 euros in the most serious cases. But the most costly consequence is not always the fine: in the event of an accident, insurance companies often refuse to pay if the coordination documentation was not in order, leaving the organization completely unprotected against claims.
Added to that is the joint and several liability: The prime contractor is legally and financially liable for its subcontractors’ failures to comply with safety regulations. Keeping your CAE documentation in order is not just a legal requirement—it’s the difference between being covered and not being covered in the event of an accident.
How to Simplify CAE Management by Training Your Company's Occupational Safety and Health (OSH) Managers
Effective CAE does not depend solely on having documents uploaded to a platform: it depends on the company’s occupational safety and health (OSH) managers understanding what to request, from whom, when, and how to verify it. An OSH manager with specific training in the coordination of business activities It can drastically reduce the time spent on document management, anticipate deadlines, and respond quickly to an audit.
