NEC3 ECS: Can cancellation costs be disallowed under Option C?

We have experienced 20+ shift cancellations relating to adverse weather, on all these occasions we have cancelled the shift before our operatives went to site therefore we mitigated the costs and have applied for the defined cost accordingly. However the principal Contractor has disallowed these costs as the cost related to ‘outside’ the working area. Therefore what they are saying is that if our workforce went to site and then the works were cancelled then the costs are payable but as they didn’t go to site they’re disallowing these costs.

Can the PC disallow these costs?

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No they are not in my view disallowable. These are costs incurred for People whose normal place of working is within the working area (first bullet of people costs). The cost could be under any of 12(a), © or (d) depending on how the payment is framed.