Welcome to the fourth in our series of educational articles, providing you with practical insight into the various mechanisms in standard form contracts and their practical application. Over the last few blogs, we have set out details about the requirements for programmes under the NEC4 engineering and construction contract (ECC). In this blog, we are addressing how and when an Accepted Programme is used.
What is an Accepted Programme?
An Accepted Programme records how a contractor intends to meet its programme obligations for achieving Key Dates and the Completion Date. As a part of that, the Accepted Programme is the place for the contractor to record the information it needs from the client and when it needs that information. An Accepted Programme is (or is intended to be) a regularly updated programme which is agreed as accurate between the contractor and the project manager. The primary intention is that it will contribute to the effective management of the construction project.
A baseline for compensation events
Apart from being a useful management tool, the Accepted Programme is primarily used as a baseline for measuring the effect of compensation events. Clause 63.5 provides “A delay to the Completion Date is assessed as the length of time that, due to the compensation event, planned Completion is later than planned Completion as shown on the Accepted Programme current at the dividing date”.
The “dividing date” is described at clause 63.1 which provides:
“For a compensation event that arises from the Project Manager or the Supervisor giving an instruction or notification, issuing a certificate or changing an earlier decision, the dividing date is the date of that communication.
For other compensation events, the dividing date is the date of the notification of the compensation event.”
This means that where a compensation event has an impact on the programme, the baseline programme used for assessing that impact is the Accepted Programme which was current when either the project manager gave an instruction, or the contractor notified of the compensation event.
The assessment is then made by reference to a change to the date for planned Completion. This is the date when the contractor expects to complete the works. It is distinct from the Completion Date, which is the date stated in the contract for when the Client wishes the works to be completed.
This distinction is important because it determines how float is dealt with. Float is the period between the date of planned Completion and the Completion Date. It will usually be a few weeks (depending on the overall length of the project). Float is a period of time included in the programme by the contractor, which allows for delays in the works, without delaying the Completion Date.
As the delay caused by a compensation event is assessed by reference to movement of the date for planned completion, this means the contractor retains the float when a compensation event occurs.
Information from the client
Throughout a construction project, it is common for the client to have ongoing input in respect of its requirements for the construction. This might include providing specifications, designs, approvals of designs etc. As all this information is often not provided to the contractor before the works commence, the contractor will need this information from the client in sufficient time to keep the works within the programme.
In the ECC, the Accepted Programme is where the contractor records what information it needs from the client and by when. At clause 31.2 it is provided a programme shall include:
“the order and timing of the work of the Client and Others as last agreed with them by the Contractor or, if not so agreed, as stated in the Scope”, and
“the dates when, in order to Provide the Works in accordance with the programme, the Contractor will need
– access to a part of the Site if later than the access date
– Plant and Materials and other things to be provided by the Client and
– information from Others”.
To provide rigidity upon which the parties can rely, if the Client does not produce the information or undertake the tasks in accordance with the Accepted Programme, this results in a compensation event.
The applicable compensation events are:
60.1(2) “The Client does not allow access to and use of each part of the Site by the later of its access date and the date for access shown on the Accepted Programme”;
60.1(3) “The Client does not provide something which it is to provide by the date shown in the Accepted Programme”;
60.1(5) “The Client of Others… do not work within the times shown on the Accepted Programme”.
A simple example is where the contractor needs specification requirements from the Client in order to procure a particular piece of plant. If the date by which the contractor needs that information is in the Accepted Programme and the Client does not provide the information by that date that would be a compensation event under clause 60.1(3).
In summary, an Accepted Programme is used:
- As a management tool for the smooth running of a construction project
- As a baseline for assessing delays caused by compensation events
- For recording when a client is required to take certain steps.
Standard contracts explained
Look out for more in our series in the coming weeks and months where we will be providing practical insight into the various mechanisms in standard form contracts, to help businesses navigate the complexities involved in administering those contracts.
If you need any further information or specific advice, please contact us.
Warren Berwick, Director, Berwick Law
Tel: 07825 171 925
As with all our blogs, these are intended to share general information. If you have any specific contractual issues, you should take specific legal advice.