When compensation events occur how can the Contractor demonstrate additional defined cost for labor/plant/supervision?
For example:
During excavation works for a drainage run alongside a carriageway an uncharted cable has been discovered.
The additional work involved is to stop works in this area, trial pits to the surrounding, disconnection charges and testing from the electricity supplier.
What could the Contractor claim in this situation: additional plant and labor for the trial pits? How would this be demonstrated? Especially if on a forecast basis. Additional supervision for on site of the electrical supplier by an Engineer/Foreman even though the site has supervision across all sections all days.
The Contractor can claim for the forecast Defined Cost that they will now incur as a result of this compensation event. If the existing Supervisor can cover this compensation event as they will be on site then you can not include that cost within the CE. If you have to bring in an additional Supervisor to cover that CE rather than using the existing one then you could claim for that. It is all about demonstrating the additional (forecast) cost that you will incur.
The rest of the quote you build up in terms of the schedule of cost components in terms of resources, equipment etc. You can think of a compensation event as a mini-tender. The point is that the Contractor should not be disadvantaged financially as a a result of having to do these additional works - but equally not take advantage of the situation and make loads of money compared to what they will actually incur. They are entitled to Defined Cost, plus fee.