NEC ECC: Does a CE need to implemented prior to payment?

Under an option A contract do compensation events need to implemented prior to inclusion in the payment certificate?

Contractually yes, given that under option A a Contractor is paid upon completed items on the activity schedule, and that a compensation event does not make it to the activity schedule until it is implemented.

This can be a problem - particularly when a compensation event is taking a long to to resolve and yet in the meantime the works are being carried out and even sometimes completed. I do see regularly Employers agreeing to pay part often CE costs “on account” whilst the quote is being agreed. If a quote is for £100k and the Project Manager has in their own mind got as far as agreeing £70k, they may pay that amount “on account” whilst the last part is considered if the works have been done. This would be particularly applicable when the Project manager knows that on their side they may have been a bit slow in assessing the quote. However - this is relying more on relationships rather than the rules of the contract.

One way I have done this in the past is to construct a mini activity schedule within the CE quote. This only works when there is a partcular sticking point that can’t be agreed upon. If there are 5 lines to a quote and 4 are agreed then they can be 100% complete and that just leaves the sticking point without payment. Not too sure where that sits within NEC but being pragmatic usually increases the chances of implementing a CE quickly and fairly.