Under the TSC, if the Employer instructed a Contractor to cease working on the activity scheduled works and re-deploy the labour that has already been paid for under the agreement, would this constitute a compensation event ?
Yes, as they are
(a) giving an instruction to stop or to start any work which is a CE under clause 60.1 (4) and
(b) introducing an additional constraint to the Service Information e.g. don’t do this work now, do that work instead, which is a CE under 60.1 (1).
However, while it is is CE, you say the labour has already been paid for. It might be a CE with no change in Defined Cost, although there might be some disruption.