NEC 3 ECSC - Equipment included in rates

Hi there,

We (Contractor) are currently carrying out a contract under the NEC 3 Short Contract and the Client has not included any preliminaries as part of the Price List.

The Client has included a statement within the Invitation to Tender reading:

“The pricing of the Tenderer’s overheads, establishment costs, charges, profit or preliminary items and all such costs associated with these items will be deemed to be included as part of the Tender Submission whether these are separately identified in the response or any pricing submission or otherwise.”

The above statement is out of the ordinary in relation to similar contracts that we carry out with this client and other similar clients. It is standard where items are listed to detail and specify the preliminaries required to carry out the works contained within the WI.

We have raised this query with the Client as an EW and are looking to agree on Welfare requirements (both for Client and Contractor personnel) and Traffic Management requirements and how these will be paid for within the the contract. In addition to the statement within the ITT the Client is advising that Welfare facilities falls under Equipment. I appreciate this may come under Cabins as part of the definition but there was no inclusion in the WI that Welfare facilities would be required for a Client Representative which we are currently supplying. Moreover, it is standard practice in most of the contracts that we carry out under the NEC 3 Short that we have preliminary items for this and these items are used to reimburse us.

The client has not amended the method of measurement to account for a change to the item coverage for its statement within the ITT but feels their statement within the ITT relieves them of having to pay for such items.

Any advice on the matter would be much appreciated.

Hi Paul. Since the WI does not mention welfare facilities for the Employer, then in my view they should not be provided unless instructed under 60.1(1), in which case you (the Contractor) would have to notify it as a CE under 61.1.

Regarding the Employer’s statement in the ITT, I would first say that it would have effect only if incorporated into the Contract, e.g. by relevant reference in the WI.

Provided that the above box is ticked, following the ordinary meaning of the works, the Employer’s statement seems to include the Contractor’s welfare (as part of “establishment” or “preliminary items”) but I cannot see any inference that can be drawn with regards to welfare for the Employer (or Client as referred to). I therefore believe that this should be instructed and notified as a CE.

P.S. Not sure I understand your Client’s reference to Equipment - if we are talking about clause 11.2(6), there is no need for the Employer’s personnel to have a site cabin in order for the Contractor to Provide the Works - unless this is a WI requirement which, as you said, is not.