Differences in opinion occur between employers and contractors on many issues. However, both will agree that completing the project as quickly as possible is a common goal, albeit for different reasons. The employer generally wants to have a project completed quickly so that the facility can be put to use as soon as possible. There are circumstances in which an employer may not want to have a project completed earlier than planned for financial or other business reasons; in such a case the employer simply wants the project delivered on time. The contractor, on the other hand, wants to complete the project as quickly as is economical because every day spent on site costs money. Furthermore, cash flow is the lifeblood of the contractor; without it he will not survive. Achieving the scheduled monthly progress helps the contractor to meet his cash flow requirements.
While employers and contractors have similar goals, they have differing needs and expectations from the schedule. Contractors will (or at least should) use the programme primarily as a planning and management tool.
The process of planning and programming the project includes determin-ing the overall approach to the job, organisdetermin-ing and planndetermin-ing the labour and equipment resources, procuring subcontractors and materials.
However, as well as being used to plan and monitor project perform-ance, a contractor’s programme has another key function; that is as a ref-erence and measurement tool for a contractor’s entitlement to an extension of time and additional payment for delay and/or disruption.
The programme; as a plan for the works
First, let’s look briefly at the programme’s role as a plan to manage and monitor the project. Most forms of contract stipulate that the contractor has to submit a programme to the contract administrator. However, many contract forms do not stipulate that the contractor’s programme is to be approved or accepted. This, in most cases, leads to distrust of the pro-gramme if it is later used by the contractor as a reference and measuring tool for additional time or compensation. It is advisable that the contract administrator should at the very least accept the programme albeit with
comments. The programme should then be used by all parties to the project as the means for monitoring and measuring progress and performance.
The degree of detail, form and complexity of the detailed base pro-gramme will depend upon the size and nature of the project in question.
Except for the simplest minor projects, simple barcharts are not recom-mended since they do not show the interrelationship between the various activities and in particular the activities’ criticality; as a consequence of this it is not possible to demonstrate the effect of events upon the pro-gramme without first agreeing an underlying critical path network. In the case of a moderately simple project, it is possible to show links between the activities on a barchart. However, it is strongly recommended that, for any reasonably sized or complex project, whatever its nature, a critical path network programme should be developed from the outset; and indeed this is often a contract requirement. Such programmes are almost invari-ably produced using proprietary planning software and for presentation purposes, summarised barcharts can easily be produced giving a summary view of the construction sequence.
The level of detail included in a critical path network programme will to some extent depend upon the complexity of a project. In general, as much detail as is reasonably possible should be included in such a pro-gramme in order to facilitate the demonstration of the effects of sub-sequent events upon the programme. It is recommended that all activities in the programme should be coded preferably with a unique activity number and that all other documentation (e.g. correspondence, labour and plant allocations) should be cross-referenced to the programme activities. The actual copy of the programme issued to the other party need not show the wealth of detail underlying the base programme: it is, however, essential for that information to be available in the event of a dispute arising.
The usefulness of a programme can be enhanced by the addition of resource and cost information. This can have considerable benefits in the administration and monitoring of a project. In particular, if these prin-ciples are followed through into other documentation it becomes a much easier task to demonstrate the link between cause and effect relative to any single event.
The importance of a comprehensive ‘baseline’ programme cannot be over-emphasised.
Of the three most common types of construction programmes, i.e.
barchart (or Gantt Chart), network, line of balance and time chainage, it is the network format that has become the most popular type for mea-suring the impact on a project in time-based disputes. Barcharts, although an extremely helpful, visual and graphical medium, are less effective than network programmes in examining time-based construc-tion disputes.
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The programme; in a claim situation
Now let’s look at the use of the programme in a time-related claim situ-ation. The programme is an essential document in determining the extent of any extension of time and/or compensation for delay. It is the bench-mark or measuring tool in these situations. However, to be effective, the programme needs to represent an accurate prediction of future events and model the characteristics of the project with activity relationships, or logic links. This allows the criticality of activities and float cushions to be taken into account when assessing extensions of time or delays.
The roles of a programme as a reference and measuring tool for both contractors and employers in delay situations are:
1 for a contractor’s entitlement to additional time for completion of the works or for sections of the works, in accordance with the contract;
2 for a contractor’s entitlement to additional payment for delay and/or disruption, in accordance with the contract;
3 for a contractor’s entitlement to additional payment for instructed acceleration, in accordance with the contract or on the terms agreed;
4 for the employer’s right to deduct liquidated damages for the contrac-tor’s failure to complete the works on time;
5 for the employer’s right to terminate the contractor for his failure to comply with the obligation to progress the works.
To establish items 1, 2 and 3 it is recommended that a network, or critical path analysis be carried out. The recommendations and guidelines of the Society of Construction Law’s ‘Delay and Disruption’ Protocol are most useful for this exercise.
For item 4, the employer’s right to deduct liquidated damages, it is necessary for the contract administrator to satisfy himself that the contrac-tor is not entitled to an adjustment of the completion date, i.e. an exten-sion of time, due to the occurrence of a relevant or delay event as described in the contract conditions. It is advisable that the contract administrator carries out a critical path analysis to satisfy this condition, otherwise an employer may receive a constructive acceleration claim from a contractor who considers himself entitled to, but did not receive, an extension of time during the project.
In the case of failure to comply with the obligation to progress the works (item 5); this is more difficult to monitor and analyse. Ideally, this requires the actual progress measured in both time and resources to be compared against the standard of progress specified in the contract.
However, under most forms of contract the standard required is specified in general terms.
42 Programmes and record keeping
Programme float
A construction or engineering project consists of a series of individual activities which are detailed on a programme and executed over a period of time. If all goes well, the project will be completed on time, but if some activities are delayed will the project be finished late?
Some activities must be completed by their planned date if they are not to delay later activities and the completion of the project. These activities are said to be on the critical path. However, for other activities, the start, or completion, can be delayed to some extent without affecting later activ-ities and completion of the project. This allowable period of delay is called
‘float’ and, provided that the delay does not exceed it, the project should still be completed on time.
Do all programmes have float? The short answer is yes, but float is only properly identifiable and quantifiable in a programme which is a logic network, more commonly known as a CPM (critical path method). A bar-chart, unless it is generated from a CPM, will not properly define the extent of float and may not even show any.
Float is an essential and inevitable part of every programme and is used by contractors in the efficient management of manpower and equipment resources. It is also vital in quantifying impact and delay in extension of time submissions and delay claims, where a contractor or subcontractor alleges a particular event caused delay and the effect of the delay may entitle them to an extension of time and ultimately a loss and expense claim.
The importance of a programme 43