We have a situation where there is a live risk which the Contractor owns under the contract. The Contractor has proposed a mitigation strategy but we are not convinced it will be effective. We’ve proposed an alternative mitigation (involving more work than the contractors original proposal). The contractor is now implementing the mitigation strategy we proposed. (Note they still believe theirs was sufficient)
The question I have is, when / where does risk mitigation become ‘change’ and how does the contract deal with it? The contractor will no doubt argue it was overkill and their proposal would work. Anything over and above that would be considered ‘change’ in their eyes.
Any thoughts would be welcomed
It depends on how you communicated your idea. If you suggested the alternative method, then it is up to the Contractor to decide on how to manage that risk. If you INSTRUCTED as the Project Manager to do something a certain way and they believe they could have achieved the requirements of the Works Information with their method of working, then the additional cost your instructed method has caused will now be a compensation event.
Thanks Glen, as ever it isn’t straight forwards. The contractors risk mitigation process (their process) for this type of risk includes discussion and agreement from the asset owner about the level of mitigation required. Their original proposal was sufficient for the first owner but not the second. the second required different work to be complete (this was more than the first asset owner).