The Ultimate NEC Compensation Event Template
Compensation Event Template for submitting Quotations under the NEC form of contract.
This Compensation Event Template is designed to help you to prepare clear, detailed and NEC compliant Compensation Event Quotations.
The NEC form of contract. is now used on most of the major projects in the UK and Worldwide. In fact, some of the largest projects in the world such as Crossrail and Hinkley Point C use the contract form.
However, although NEC published the first version of the contract back in 1993 and has been widely used for decades, there are still many contractors that may be new to the NEC way of working. In contrast, instead of “variation” and “extension of time” the NEC replaces both with a single provision called the Compensation Event.
So, when one of the “triggers” set out in clause 60.1 occurs, one of the parties can notify a Compensation Event. Following this, once the CE is accepted by the Project Manager, the Contractor is instructed to submit a quotation in respect of the event. This includes both cost and time effects.
In respect of this, the contract’s exact wording is as follows:
(Clause 62.2) “Quotations for compensation events comprise proposed changes to the Prices and any delay to the Completion Date and Key Dates assessed by the Contractor”
From our perspective, we have been administering NEC contract for years. So we know all too well the importance of putting forward a complete Compensation Event Submission that is compliant with the contract. This helps to agree change swiftly and fairly.
Perfect formatting every time!
This template is all ready formatted to PDF with one swift click.
See for yourself by downloading the PDF output from the template here.
Cost Impact Tab
Summarises your cost buildup into the categories of allowable costs set out in the Shorter Schedule of Cost Components.
Time Impact Tab
Under an NEC contract, we impact the event on the Accepted Programme, to demonstrate time impact on the Key Dates and Completion. You can then summarise the results of this excercise here.
Typically, the contractor will develop the Compensation Event Quotation in advance of the works being carried out. In fact, the provisions of the contract encourage this. This tab allows you to set out a programme for the planned works.
Cost Buildup/ Pricing Tab
Allows you to quickly insert the appropriate rate from the Schedule of Cost Components in your contract.
So no more messing around searching through rate books!
The contract requires that you evidence Defined Cost in instances where works have been carried out already.
This tab allows you to provide a detailed summary of your site records.
In our experience, many contractors often overlook including additional risk allowances in their Compensation Events.
Clause 63.6. Assessment of the effect of a compensation event includes risk allowances for cost and time for matters which have a significant chance of occurring and are at the Contractor’s risk under this contract.
You can use this tab to include for risk allowances in your Compensation Event Quotation. So you can demonstrate clearly the rationale behind the calculations.
Designed for ease of use
The template is self-explanatory and easy to use, and for additional ease of use we have included a tab containing instructions and helpful tips.
We have highlighted the sections which require manual inputs.
The sheets are also pre-formatted optimised for converting to PDF or printing.
All templates are fully unlockable so you can customise them to suit your business.
Compensation Event Template for Excel
Available for instant download now!