Frequently Asked Questions

For the purpose of pricing a compensation event using an NEC3 ECC option D contract (target contract with bill of quantities), does the cost of a subcontractor security guard employed on an hourly rate contract fall under the people component item 1 in the schedule of cost components, or is such cost deemed to be included within charges item 44, which refers to security?

If the contractor pays for the security guard on an hourly basis, then the guard is not a subcontractor as defined in the contract. The guard is a person that is indirectly employed by the contractor and is therefore paid for at item 14 in the schedule of cost components. The guard is not included in the item 44 percentage for working areas overhead because that only covers, ’provision and use of equipment, supplies and services’; people employed do not fall into any of those categories.

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