Beyond the pandemic

[edit] Introduction

As the Covid-19 pandemic continues, there are questions about the impact on contracts and future projects. ICE is bringing together experts to help others understand the impacts.

[edit] Challenges

The ongoing Covid-19 pandemic is presenting many challenges to civil engineers. Delivery of ongoing projects is being challenged by site shut-downs, material supply issues and shortages of personnel. Beyond that, future workloads are uncertain although the announcement of the notice to proceed on High Speed 2 is incredibly welcome.

It is already a reality that many major employers of civil engineers are using the UK government-funded Coronavirus job retention scheme that sees government paying 80% of the salary of workers placed on temporary leave or 'furlough'.

This is presenting challenges for joint venture partners and other project teams who, often at short notice, are finding themselves missing key team members. It seems almost inevitable therefore that contractual and legal issues will arise as those running projects struggle to remain on schedule.

In many cases the application of the NEC contract is likely to be key. To help with this, NEC4 Contract Board Chair Peter Higgins has been leading on providing advice to NEC users, producing guidance and hosting Q&A sessions for users alongside board member Ian Heaphy. View the session here: https://youtu.be/q-vsD3gCC-k

[edit] Understanding force majeure

It is far from simple, and misinformation abounds. For example, just how many times have the two words 'force majeure' been used recently? Yet how many people understand what force majeure actually is or how it is applied?

Force majeure is a legal concept in many countries. In England, however, where there is no civil code, provisions to deal with force majeure should be set out in the contract. And these provisions vary from contract to contract.

The NEC3 and NEC4 contracts do not use the words force majeure at all, but make an event that looks like force majeure a compensation event. The JCT form of contract does use the term, but force majeure is not defined. The 1999 'Silver Book' version of FIDIC contracts does contain provisions defining force majeure as an exceptional event or circumstance beyond a party's control, but the term is dropped in the 2017 version. It really is complex.

[edit] Resources

ICE has a wealth of knowledge products for civil engineers to quickly refresh their understanding of law and contracts. This includes CPD modules and up-to-date contract guidance notes in the dedicated, member-only online Learning Hub.

As project teams attempt to press on in the face of Covid-19, there is also the fundamental challenge of ensuring that infrastructure remains safe. Perhaps now more than ever, civil engineers need to be aware and alert to safety-related issues.

To the bigger, future workload question, that is more complex still. Going forward, the world now faces three overwhelming threats of global disasters – climate change, the Coronavirus pandemic, and unknown, transformative socio-economic changes in its aftermath. Some of these socio-economic changes, if sustained, will have positive effects in support of climate change mitigation and adaptation. But what does that mean for infrastructure systems? What will society want from roads, railways and other vital communication networks?

ICE will be working with some of the smartest engineering minds and some of the UK's and the world’s leading academic institutions to explore these changes in depth. These findings will be shared as they emerge.

--The Institution of Civil Engineers

This article was originally published on 17 April 2020 as 'Understanding the impact of Covid-19 on contracts and future projects' on the ICE Civil Engineer Blog. It was written by Mark Hansford, Director of Engineering Knowledge.

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