Format:     

Interactive session with real-world examples, Q&A, and optional handouts

Materials Provided: 

Slide pack, printed summary handout, CE process flowchart

Section 1: Commercial & Operational Awareness

1.1 Commercial Objectives & Contractual Boundaries

• Aligning NEC4 use with business strategy

• Managing scope, risk appetite, and outcomes

• Avoiding unapproved or undocumented work

1.2 Operational Readiness

• Preparing teams and systems before delivery starts

• Reviewing the Accepted Programme

• Setting up robust record-keeping systems (photos, diaries, site registers)

1.3 Balancing Cost, Time, and Quality

• Using the programme to track time and cost

• Understanding how changes affect commercial outcomes

• Preventing defects and managing their cost/time impact

1.4 Programme Integration & Clause 31

• Keeping the programme updated and reflective of actual progress

• Operational consequences of non-compliance

• Linking CE decisions to real-time programme data

Section 2: Payment & Cost Management

2.1 Understanding Payment Mechanisms

    • Overview of payment structures across ECC, PSC and TSC
    • Activity Schedules, BoQs, Task Orders and Time-based payments

2.2 Defined vs Disallowed Costs

    • What is recoverable under target/cost-reimbursable contracts
    • Common causes of disallowed cost and how to avoid them

2.3 Schedule of Cost Components (SCC & Short SCC)

    • Accurate allocation of labour, plant, materials, and subcontract costs
    • Role of the SCC in cost reporting and CE assessments

2.4 Applications for Payment (Clause 50)

    • Submission, assessment, and certification processes
    • Timing, accuracy, and implications of late responses

2.5 Fee Percentages & Pain/Gain Mechanisms

                      
    • How fee is applied to Defined Cost
    • Introduction to target cost contracts and cost-sharing arrangements

Section 3: Managing Change Under NEC4

3.1 Early Warning Notices (Clause 15)

• Purpose and importance of EWNs

• Raising EWNs proactively – not reactively

• Tracking and recording responses

3.2 Risk Reduction Meetings

• Turning EWNs into mitigation actions

• Facilitating collaborative solutions before escalation

• Documentation of discussions and agreed steps

3.3 Change Control in NEC4 vs Traditional Contracts

• NEC4: Prospective and transparent

• No waiting until final account – real-time admin

• Reducing claims and disputes through early engagement

Section 4: Compensation Events (CEs)

4.1 Understanding Compensation Events

• Definition and examples (e.g., weather, late instructions, scope changes)

• Differentiating between Employer and Contractor responsibility

4.2 Time Bar and Notification Obligations

• The 8-week time limit for CE notifications

• Exceptions and Employer breaches

• Role of site/commercial teams in early flagging

4.3 CE Assessment and Implementation

• Forecast-based assessments and when retrospective applies

• The step-by-step CE process:

1. Notification

2. Quotation

3. PM assessment and implementation

• Importance of speed, forecasting, and documentation

4.4 Avoiding Disputes Under NEC4

• How EWNs, updated programmes, and CE dialogue reduce risk

• Dispute resolution options in NEC4: DABs, Adjudication

• The role of early engagement and good records