Frequently Asked Questions

We are the client on an NEC3 ECC Option D contract (target contract with bill of quantities). If we amended the schedule of cost components so that the cost of the contractor’s professional staff who are working in the working areas were not part of defined cost, what effect would this make?

It would create a degree of uncertainty for the tenderers. They would have a good idea of the amount of professional staff needed to provide the (original) works in accordance with the works information and the fee could be increased accordingly as the amount of defined cost would be reduced. So, this part would work fine.

However, we have never yet experienced a job without compensation events. How therefore could the tenderers possibly guess how many compensation events there might be, of what value and what professional staff therefore might be required? Even worse would be those compensation events that have little or no effect on defined cost but a significant effect on professional staff.

So, the uncertainty would lead to the tenderers gambling on the fee, which is not the most sensible way to go about bidding and therefore we recommend such changes are not made.

The same answer would apply if the NEC4 ECC were used.

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