Monday 17 November 2014

Using schedules of rates with NEC3 contracts

There's a number of occasions users have asked 'am I ok using a published schedule of rates with NEC3 contracts'? The sorts of questions are about using the SoR for:
- ECC for assessing compensation events (clause 63.14, if both Project Manager (PM) and Contractor agree),
- TSC or TSSC for use in/as the Price List,
- the quotation procedure when setting up the NEC Framework Contract.

The simple answer is yes(ish), the longer answer is really more of a 'watch it'. By this I mean take care to find out precisely what are in (or out) of the SoRs - do they include overheads & profit, financing charges, insurance premiums and the like? If they do, how are you going to work that through with things like the ECC Fee % taking care not to double up or leave something out. So read the front end of the published SoRs very carefully indeed to make sure you know the basis of the rates you wish now to use.

It would be good one day if all such published SoRs were neutrally drafted to enable them to be used by any standard form contract. Until then, take care!

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