Expert advice in minutes not days. Register it's free and ask your first question now.
ReachBack is a free community help desk for construction professionals run by Built Intelligence. A library of high-quality questions from real users with answers delivered and curated by industry experts.

5,052 questions

5,387 answers

1,130 comments

Register its Free

Download here

NEC ECC: When is the Contractor entitled to a direct fee and when is a subcontractor entitled to a Subcontractor's fee?

0 votes
55 views
What is the difference between P&G's, and direct fee?
asked Jun 5 in General by Lebotau (140 points)  
The Contractor is entitled apply the Direct Fee on top of the Defined Cost. This could be on all costs demonstrated under a 'cost reimbursable' options such as an Option C (Target Cost) or Option E (Cost Plus). This Direct Fee and Subsubcontract Fee is also applied on Compensation Event Quotations.

The Subsubcontract fee is only applied to Subcontractors. A Subcontractor is a person or organisation who has a contract with the Employer. The full definition is  under CL 11.2 (17) (Option A)

The Direct Fee is applied on all others works, this is described under 11.2 (8) (Option A)

So in summary, Subcontract Fee on Joe Blogs Construction Ltd. Direct Fee on your Schedule of Cost Components.

1 Answer

+1 vote
Just to add to QS007's comment above, As well as including for P&G type costs, the direct fee also includes head office overheads and any other cost not included in the Schedules of Cost Components.
answered Jun 10 by stevencevans (570 points)