Last edited 22 Sep 2020

Works contractor

Management contracting is a procurement route in which the works are constructed by a number of different works contractors who are contracted to a management contractor.

The management contractor is generally appointed early in the design process so that their experience can be used to improve the cost and buildability of proposals as they develop as well as to advise on packaging (and the risks of interfaces). This also enables some works contracts to be tendered earlier than others, and sometimes, even before the design is completed (for example, piling might commence whilst the detailed design of above ground works continues). This can shorten the time taken to complete the project, but does mean that there will be price uncertainty until the design is complete and all contracts have been let.

Management contracting differs from construction management in that management contractors contract the works contractors direct whereas construction managers only manage the trade contracts, the contracts are placed by the client. In legal terms the management contractor is acting as a principal whereas the construction manager is acting as an agent.

This means that on a management contract, the client only has one contract to administer (whereas with construction management there can be many contracts for the client to administer), but they might want warranties from the works contractors so that they can make a direct claim against them, for example if the management contractor becomes insolvent.

See also: Management contracting - pros and cons.

The contractual components of a management contract project are likely to include:

Features of works contracts include:

NB: For a detailed description of the sequence of tasks necessary on a management contract, see our free work plan - Management contract: outline work plan.

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