Event has occurred under NEC3 ECS Main Option C.
An event had occurred during the construction phase of the project, which stopped all works for approximately 10 months before the works resumed. It was unclear for how long the stand down period would last when the event started to occur. The responsibility to provide the means for the Subcontractor to resume works was with the Contractor.
During the 10 month delay, the Subcontractor was asked to mitigate costs to a minimum, but not demobilise from site completely. The Subcontractor kept the site setup, off-hired all possible equipment and, where possible moved their directly employed to other projects to mitigate the projects costs.
However, the Subcontractor was not able to utilise the directly employed labour on other projects without additional expenditure for the full 10 month delay. Therefore, towards the end of the delay period, the direct employed labour was brought back to the project and stood waiting on site until the works could resume (Subcontractor raised early warnings ahead of this occurring).
Throughout the stand down period, numerous possible restart dates were given by the Contractor. Although risk reduction meetings were held along with compensation events throughout the period for “extensions of time”, the Contractor did not instruct the Subcontractor to demobilise completely, but minimise costs to as low as possible.
The Contractor is currently disallowing the costs and not allowing them to be priced as part of the CE as the Contractor believes these costs are not in accordance with providing the works. The Subcontractor does not agree and believes it should be paid as Defined Cost and form part of the compensation event (target increase). Note, the Subcontractor only exposed the Contractor to 2 months’ worth of labour costs during the near 10 month delay, therefore mitigating 80% of the labour costs during the delay period.