NEC (New Engineering Contract) is a suite of contracts that put emphasis on partnering and collaboration between the contractor and client. Unlike other standard frameworks for construction contracts, NEC3 is strict with its requirements for the development, acceptance and revision of the Programme. Lack of above leads to a number of issues including lack of common baseline from which to plan, manage or monitor the progress of the works. This also translates into inability to assess any change or its impact on the programme of works.

Unfortunately, there seems to be a lot of misunderstanding around Programme Acceptance criteria under NEC3. Project Managers are reluctant to accept Programmes fearing that acceptance automatically means accepting responsibility for delays that the Programme shows or any other issues that have arisen between the last Programme deemed accepted and current date. It is worth noting that accepting the Programme does not discharge the contractor of any responsibility, which is stated in clause 14.1. The contract uses “acceptance” and not “approval”. Accepting a Programme simply deems the Programme realistic and fit to be used to assess further changes. Accepting a Programme does not overwrite the original Works Information – the only person who can change the Works Information on a project is the Project Manager.

Hesitation to work together to accept a Programme undermines the intent of the contract and prevents managing the project in line with best practice. It is reasonable to assume that both parties would want to understand where the project is at any point in time which is facilitated by an accepted Programme.

Under clause 31.3 the Project Manager has to accept or not accept a Programme within two weeks of submission. When the Project Manager decides to not accept a Programme, under clause 13.7 this has to be notified to the Contractor INCLUDING reasons why. Under the contract there are four reasons for the acceptance to not be granted.

1. Contractors plans shown are not practicable
2. It does not show the information which this contract required
3. It does not represent the Contractors plans realistically
4. It does not comply with the Works Information

As tempting and easy it is to simply reject the programme quoting the above 4 reasons, it is not a collaborative approach. Collaboration is the backbone of NEC and should be exercised whenever possible. When the assessor uncovers issues with the submission, it is in best interest of both parties to understand the exact reasons that drive the rejection. Let’s break them down and look at some examples of the above criteria not being met.

1. Contractors plans shown are not practicable – The word “practicable”, as defined by the Cambridge English Dictionary, means “able to be done or put into action”. Plans that are not practicable could therefore assume such situations as high number of people working in confined space (6 electricians working in a cabinet that can only accommodate 2), an activity starting prior to its natural predecessor, unachievable activity durations, work on site starting prior to access to site being granted, overall logic issues where the plan indicates physically impossible situations can take place.
2. It does not show the information which this contract requires – as covered by one of the longest clauses in the Contract – 31.2, that shows a comprehensive list of what should be included in a programme issued for acceptance. Some of these include starting date, Key Dates, Completion Date, Planned Completion, order and timing of the operations which contractor plans to do, provisions for float, provisions for Time Risk Allowances, dates when in order to provide the works the Contractor will need access to any part of the site, acceptances, Plant and Materials provided by the employer, information from others, any other information that is requested within works information, statement of how the contractor plans to do the work identifying principal equipment and resources which are planned to be used.
3. It does not represent the Contractors plans realistically – The word “realistically”, as defined by the Cambridge English Dictionary, means “according to the facts and what is possible”. Furthermore, this is not a duplicate of point 1. that treats about the plan itself being not practicable. Point 3 is about the Programme’s realistic representation of Contractor’s plans. As an example: it is unrealistic (therefore not based on facts, unlikely to happen) that the Contractor can spend manpower carrying out works that have been completed. It is unrealistic to assume that work requiring 10 operatives to be complete in 1 day can be completed in the same amount of time by half the operatives. It is unrealistic that cables can be terminated before they are installed. Assumptions can be unrealistic too. It is unrealistic to assume that more manpower flooding the project can always bring forward the completion date.
4. It does not comply with the Works Information – it does not show the full work scope of the project as defined within the Works Information or does not comply with requirements set out in the WI.

Any other concern that results in rejection should be recorded as a Compensation Event under 60.1. Furthermore, should the PM not accept or reject the programme, this should be recorded as EWN as well which would naturally result in a risk reduction meeting to discuss the issue.

It should be understood that regularly reviewed and accepted Programme is a management tool that facilitates success of a project and clearly shows the snapshot of progress and all changes at a regular, given point in time. Uncollaborative approach or delaying acceptance without communicating with the Contractor in attempt to resolve any existing issues will always result in poor visibility of the finish line and will make any analysis and corrective action much more difficult. This is very much working against best interest of all parties involved.

Have you ever had issues with having your programme accepted under NEC3? Were you in a position where you were unsure if accepting a programme will result in acceptance of liability for delays? Make sure to leave a comment so we can have a constructive discussion.

---

We are a London based, independent construction consultancy specialising in Project Services with Dispute Resolution Reachback. We act as interim managers but are open to longer commissions.

Our offer includes Planning Management, Commercial Management, Risk Management, Claims Management, Dispute Services, NEC Advice and Training.

---