Construction industry pay heed
Calling all employers, contractors and sub-contractors in the construction industry
If there was ever a time for contractors, subcontractors and employers to work together to overcome a problem now is that time.
Most of those in the industry will agree that when it comes to assessing an EoT entitlement and costs arising that the best way to approach this is to ask for the time and money prospectively and contemporaneously.
That means, as recommended in the SCL Protocol Core Principle 4, do not ‘wait and see’ regarding impact of delay events.
“The parties should attempt so far as possible to deal with the time impact of Employer Risk Events as the work proceeds (both in terms of EOT and compensation). Applications for an EOT should be made and dealt with as close in time as possible to the delay event that gives rise to the application. A ‘wait and see’ approach to assessing EOT is discouraged.
Where the Contractor has complied with its contractual obligations regarding delay events and EOT applications, the Contractor should not be prejudiced in any dispute with the Employer as a result of the CA failing to assess EOT applications. EOT entitlement should be assessed by the CA within a reasonable time after submission of an EOT application by the Contractor. The Contractor potentially will be entitled to an EOT only for those events or causes of delay in respect of which the Employer has assumed risk and responsibility (called in the Protocol Employer Risk Events) that impact the critical path.”
When this lockdown is over all our minds are going to be concentrated on getting the construction projects up and running again and completed as quickly as possible, efforts will be concentrated on resources and procurement and not resolving the matters of entitlement to EoT and compensation.
To do this a framework needs to be put in place now, before the lockdown is over. Now is the time for employers to approach their main contractors and for main contractors to approach their subcontracts with the aim of reaching a general agreement as to the way forward as quickly as possible with the aim of bringing certainly to an uncertain situation before the end of the lockdown and leave it clear for all efforts to then concentrate on the project.
So listen to my call.
Get talking now.
Call me if you need any assistance.