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NEC ECS: Compensation Event - Required Overtime

+1 vote
122 views
Contract Option C - Target Cost

We (The Contractor) have requested the Subcontractor to work out of hours. With several trades in our properties during the week we have requested the carpet fitters to lay the carpets on the weekend for a few properties due to clashes with other trades. The carpet fitters (S/C) are therefore working 7 days a week to achieve original scope.

The weekend work would be a Compensation Event as is a change to the works information (which states the hours of work Mon-Fri 40hrs a week)

The question is how much the Target is increased by due to this Compensation Event. The S/C is looking to increase target by the hourly rate plus premium time. The Main Contractor argument is that the target should only be increased by the premium time due to actual scoped works being completed (i.e. the additional cost for working the weekend)

We are not looking to accelerate the contract as there will be no change in completion date. Overtime only due to clashes with other house building trades
asked Dec 18, 2018 in Compensation Events by Hrunner (370 points)  

1 Answer

0 votes
It should be the extra over cost that the CE is going to cause - which would sound like the premium time not the normally hourly rate as well.

It is for the Contractor to present their quotation justifying any additional cost they believe the CE will give them. If you don't agree their quotation then obviously you have the right to assess it yourself - to what you believe is correct in accordance with the contract. Their only formal way to overturn your decision would then be adjudication.
answered Dec 18, 2018 by Glenn Hide Panel Member (77,810 points)  
This is always a difficult CE to assess as it looks as though there has been an element of disruption with other trades.  The Subcontract probably states that access is 'not exclusive' or that you are to 'work around other trades' so an element of disruption should have been included in the contract programme / rates. The value of any CE is the total actual and forecast Defined Cost including the CE, less the same without the CE.  Although the completion date is unchanged, the timing of the scope of works has changed.  If the CE has not increased the overall number of days of work, then the value should be based on the 'extra over' cost of those working hours, that is for working at weekends.