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Last edited 06 Jul 2023
 What is a substitute in terms of construction?
A substitute in general building and construction terms refers to changes made to an original agreement, such changes can fall into a number of different categories and be for products, materials, equipment, methods of construction and even personnel or contractors. It is a very complex area within the design and construction field that can relate to contract law, construction law, liability, standards as well as off-payroll working rules. In terms of the former it is important to note that in general most contracts usually do not permit any form of substitution by a contractor without approval from the contract administrator, who is acting on behalf of the client. In terms of working rules, though again complex it may be safe to assume that the same is true, in that substitution is not acceptable under normal conditions unless with prior agreement as maybe specifically noted within a contract or potentially as a result of extenuating circumstances. .
In terms of products and materials there will be differences in how and if the issue of substitution arises depending on whether a performance specification is being used or a prescriptive specification and the details of the contract. There are many different terms and phrases that might be related to the subject of substitution, in connection to building projects, many of which have quite specific legal and contractual meanings such as;
Formally any items that require a change from those agreed in the contract documents to those proposed by contractor need to be done so by prior or later agreement. This is often referred to as a variation, which is a formal request by the contractor to the client, clients agent, Architect or contract administrator, to substitute a particular product with one that might be considered equal or superior in terms of performance, for example from a specific brand to an alternative, because of cost, environmental or program reasons. The variation or substitute product has to then be approved by the contract administrator before it can be used to replace the product that was formally agreed, as part of the process reasons for the change will most likely be required as well as supporting information such as the new product performance data, certification, safety tests and samples.
 Contractors and personnel
In terms of the actual contractor themself, this can be an equally complex issue that relates in detail, to whether a client is paying for the services of a particular individual or contractor or just for the service as it were, irrespective of whom delivers it. The HMRC internal Employment Status Manual describes some of the issues relating to substitution in terms of contactor performance: “Many contracts contain clauses that appear to give a right of substitution. It seems likely that many of these clauses have only been inserted to try and break the requirement for personal service and change the contract from one of service to one for services. Normally a client requires the services of a particular worker and a substitute would not be acceptable so there must be doubts about the validity of such clauses.”
 Possible reasons for a substitution
- Value Engineering - Probably one of the most likely reasons for substitutions is to make cost savings.
- Supply chain scarcity - If a specified product has particular supply issues or delays in delivery, alternatives may be sought to reduce impact on the programme.
- Supply chain availability - Likewise if a contractor has over orders or an existing and available stock of a particular product, they may make a case for a substitution, perhaps o the basis of cost or programme savings.
- Newer products - Construction projects can take considerable time to be realised or older specifications reused and not updated, during the intervening period newer products can come on the market or existing product become more available that may be preferable
- Approved products - Certain systems may require installation by approved contractors to qualify for warranties and as such certain products maybe needed to mach the approved installation process.
- Differing standards - Certain products may be assessed under certain standards, for example BS but alternatives approved under for example EU or German DIN standard deemed acceptable.
- Changing standards - Construction projects can take considerable time to be realised or older specifications reused and not updated, during the intervening period, standards may change or events may require the substitution of certain products. For example Fire Safety issues.
- Performance - There may be extra requirements in terms of the performance and testing of products that may reduce the number of potential products to be used, for example where products are required to have Environmental Product Declarations or Product Environmental Footprint certificates.
- Contractor's designed portion.
- Contract documents.
- Final specifications.
- Insulation specification.
- Outline specification.
- Output-based specification.
- Material substitution.
- Prescriptive specification.
- Production information.
- Project brief.
- Public procurement.
- Service level specification.
- Specification basics.
- Substitution terminology in construction.
- Tender documentation.
- Track record.
- What should be included in a scope of work?
- Performance specification.
- Prescriptive specification.
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