X2 change in law

I am currenty working on a recently commenced NEC 3 Option A contract, the secondary option clause x2 is included but X1 is excluded.

CL 60.1 (19) has been amended to time only.

If another covid wave were to happen and resulted in a change in the law e.g. social distancing restriction re-imposed, this is likely to impact the contrators output on site and thus cause delay to the works.

There is potential that social distancing could also impact the supply of materials required on site.

Under cl 63.6, is the contractor permitted to include any potential material cost increases in a compensation event due to the change in the law?

I have read conflicting opinions on other platforms.

I believe there is a misconception regarding price increases taken into account when assessing CEs.

In the case of Option A, Defined Cost is the cost of the components in the SSCC - see clause 11.2 (22). The assessment of the CE is undertaken as set out in clause 63.1, whereas the material prices will be “current” for when the work was done and/or for when the work will be done, including risk allowances e.g. for expected further increases in price.

The reasons behind the material price increases, in my view, are not relevant to the CE assessment principles and therefore, answering you main query, the risk allowances under 63.6 should include any such potential increases.

As regards the change in the law, be wary that the social distancing rules were issued within published Government guidance and would not easily qualify as a change in the law if issued again (see NEC3 Guidance Notes). Unless you can identify new legislation relevant to the specific restrictions (if and when imposed), you would probably have to look at other routes of justifying a CE, such as an instruction by the PM etc. For time only, you would probably be ok with 60.1 (19) as amended, but be cautious of the conditions stated, especially the one pertaining to the “chance of occurring”.