In most circumstances, should the subcontracted fee % be higher on an option A than option C?
Option A states (22) Defined Cost is the cost of the components in the Shorter Schedule of Cost Components whether work is subcontracted or not excluding the cost of preparing quotations for compensation events.
I take this to mean that the Subcontractor’s Fee % under his subcontract is not included in the main contract Defined Cost. Therefore on option A, should the subcontracted fee % under the main contract include for the Subcontractor’s Fee % payable under the subcontract plus the Contractor’s OHP ?
Option C states (23) Defined Cost is
• the amount of payments due to Subcontractors for work which is subcontracted without taking account of amounts deducted for
• payment to the Employer as a result of the Subcontractor failing to meet a Key Date,
• the correction of Defects after Completion,
• payments to Others and
• the supply of equipment, supplies and services included in the charge for overhead cost within the Working Areas in this contract
• the cost of components in the Schedule of Cost Components for other work
less Disallowed Cost.
Therefore on option C should the subcontracted fee % under the main contract only include for the Contractor’s OHP, as the Subcontractor’s Fee % under his subcontract is included in the defined cost?