What does NEC stand for in construction?
What does NEC stand for in construction?
New Engineering Contract
What is the difference between a JCT and NEC contract?
JCT provides separate contracts for employer-design or contractor-design. NEC identifies a state at completion which is defined within the works information, unlike JCT which relies upon a subjective judgement of practical completion determined at the time.
Is NEC3 design and build?
NEC3 Design and Build Contracts have been used on some of the highest profile projects in the world, including the London 2012 Olympics, as well as every day projects like construction of buildings, highways and process plants.
What is NEC Option E?
Option E is a cost reimbursable contract in which the contractor is reimbursed the actual costs they incur in carrying out the works, plus an additional fee. Option E contains the core clauses, secondary option clauses, schedules of cost components, contract data, and so on.
Is NEC Option A Remeasurable?
No they can’t, although it does depend a little on why you have not done the amount described. If the Employer instructed less work off their own back then yes this would be a compensation event and a saving, but otherwise no.
Is NEC option a lump sum?
Option A – priced contract with activity schedule, Lump sum price for the Works. Lump sum may change if a “Compensation Event occurs or the Employer varies the Works”.
How does NEC Option C work?
‘The NEC Option C is a target cost contract with activity schedule where the out-turn financial risks are shared between the client and the contractor in an agreed proportion. Throughout the works the Contractor is reimbursed for his “Defined Costs” plus fee minus any “Disallowed Costs”.
What is nec4 option C?
The Option C is a cost plus form of contract where the target cost is based on the activity schedule. In this Target Cost contract the out-turn financial risks of any savings, or overruns are shared between the client and the contractor in an agreed proportion.
What is a defined cost in NEC?
Broadly speaking, Defined Costs are the actual costs incurred by the Contractor on the Works minus retention and any costs which would fall within the overheads covered in the Fee. From those are deducted “Disallowed Costs”. “Disallowed Cost” is defined by Clause 11.2(25).
What is a pain gain share mechanism?
The basic principle is that a target cost is agreed and then the contractor is paid for the work undertaken on a cost reimbursable basis. Conversely, if the actual cost is higher than the target cost there is an over-spend, again shared between the parties on a pre-agreed percentage split – referred to as “pain-share”.
What is disallowed cost?
Disallowed Costs are those which the contractor has incurred, but for which the employer does not have to pay. This could include costs which cannot be justified, those which should never have been paid to a subcontractor or supplier, or those incurred because the contractor did not follow certain stated procedures.
What is a target contract?
A target cost contract is a type of cost reimbursable contract under which the contractor is paid the ‘actual cost’ (usually defined in the particular contract) it incurs in carrying out the works, but subject to a target cost which is agreed by the parties at the beginning of the project.
What is nec3 Option A?
Option A is a priced contract with an activity schedule where the risk of carrying out the work at the agreed prices is largely borne by the contractor. This document contains all the clauses, the shorter schedule of cost components and contract data, relevant to an option A contract.