# Defined cost for people

**URL:** <https://reachback.builtintelligence.com/t/defined-cost-for-people/16587>\
**Category:** NEC3 and NEC4 Contracts\
**Created:** [29 November 2021 16:15 UTC](https://reachback.builtintelligence.com/t/defined-cost-for-people/16587 "2021-11-29T16:15:43Z")\
**Posts on this page:** 2\
**Page:** 1

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**Author:** ![RAW1985](https://dub1.discourse-cdn.com/flex013/user_avatar/reachback.builtintelligence.com/raw1985/32/96_2.png) [@RAW1985](https://reachback.builtintelligence.com/u/RAW1985)\
**Post date:** [29 November 2021 16:15 UTC](https://reachback.builtintelligence.com/t/defined-cost-for-people/16587/1 "2021-11-29T16:15:43Z")

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I have recently put a topographical survey out to tender, a contractor is unsure of the following meaning and have asked for clarification;

**The percentage for overheads and profit added to the defined cost for people is; and The percentage for overheads and profit added to other defined cost is;**

My understanding of this is that their percentages will be applied for any additional work or extra time that is required as part of the contract in question, are you able to confirm this and or explain it a little clearer.

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**Author:** ![stevebrownassociates](https://dub1.discourse-cdn.com/flex013/user_avatar/reachback.builtintelligence.com/stevebrownassociates/32/61_2.png) [@stevebrownassociates](https://reachback.builtintelligence.com/u/stevebrownassociates)\
**Post date:** [1 December 2021 09:13 UTC](https://reachback.builtintelligence.com/t/defined-cost-for-people/16587/2 "2021-12-01T09:13:01Z")

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Hi, I’m assuming you are referring to the NEC3 Engineering & Construction Short Contract in which case your understanding is correct. The percentages are applied to the Defined Cost of work associated with a compensation event and applied in accordance with clause 63.2. Defined Cost is defined under clause 11.2(5) and the two percentages are applied accordingly.