Under a NEC framework the contractor has applied for costs for staff who has been medically suspended. The staff member is contracted under a cost reimbursable PSC contract and not a project delivery contract.
On and off for an initial 4 month period the staff member was self certified or signed off by his GP. Eventually he felt fit for work and was signed back on by his GP.
The clients security team however withheld clearance to work on the site as they felt they posed a potential risk and suggested he be referred to the contractors occupational health provider. The occupational health provider recommended further treatment.
The staff member was then put on ‘Medical Suspension’ for a further 5 1/2 months before starting a phased return. Under the staff members terms and conditions they are entitled to 6 month full pay which can be extended upon review. In this case the period was extended.
Under the contract sickness is reimbursable however does this extend to the medical suspension period triggered by the contractors own occupational health provider? Or should the contractor pick up these costs.
Please can you clarify your question? First paragraph says the person is contracted under a PSC (Option C or E?) however your question relates to the ECC, also Disallowed Cost isn’t a concept in the PSC.
Assuming we’re talking about a person employed by the Contractor then the Employer does have some liability to pay for people who are absent due to ill health. The Schedule of Cost Components item 12(e) states payments to people for absence due to sickness.The key thing here is that the Contractor must prove that the person is directly employed and that they are paying the employee in accordance with their employment contract.
If the person is not directly employed then the Employer is liable to pay the amounts paid by the Contractor, if the person was for example paid via an agency or was a labour only subcontractor then it would be highly unusual for them to be paid anything whilst they weren’t at work.
Sorry of the late reply this issue has been put on hold due to COVID.-19.
A bit more clarity.
-The staff is direct employed to the contractor.
-Whilst working he was working on a delivery contract NEC Option C. Should the medical suspension costs be allowable they want to charge these against a PSC Core Staff contract.
- The contractor did not provide any prior notification to the employer that they intended to extend his full sickness pay.
It sounds like how the contracts are being used on the framework very specific to the framework so it’s difficult to advise further without analysing how the framework operates and it’s terms as well as any Z clauses that may have been used. It also makes a difference if it’s NEC3 or NEC4 PSC as the approach to reimbursement under Options C and E is entirely different. Also your final point about prior notification is fairly irrelevant as there is no obligation for the Contractor to have notified this matter.