For some background, we have an Option A Contract down the line to our subcontractor and an Option E with the client. We have agreed labour rates in our Contract Data Part Two (down the line) explicating stating the rates for week and weekend working for operatives, supervisors etc which we have used to value Compensation Events.
When we are to value a CE down the line our client is trying to propose that we do the following: The rates that have been included within the Contract Data Part 2 are not relevant to the assessment of Compensation Events as these relate to people outside the working areas (i.e not within the site). Unless there is an agreed labour matrix included within the subcontract the default position is to value People in accordance with the Shorter Schedule of Cost Components. Thus, the Subcontractor would have to demonstrate actual costs and add the WAO% then Fee.
We are in a predicament as our client is trying to force a labour rate that they have came up with, which they see as ‘competitive market rates’ and in this situation we do not know whether to hold our ground and use the rates within the Contract Data Part 2. Please can you advise.