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What Is Disruption

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29 views7 pages

What Is Disruption

Uploaded by

kontractsmanager
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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accuraconsulting.

com
What is
disruption?
Disruption is an interference that disturbs or slows down a
Contractor's usual working methods, leading to reduced
efficiency. Disruption is not the same as delay, however a
disruption can be the cause of a delay.

Disruptive events have a direct impact on work, leading to


reduced productivity through factors such as:
insufficient or altered site access;
work performed out of sequence, or;
design modifications.

Additionally, they can cause indirect consequences like


overcrowding of workers, inefficiencies from disorganised
work groups, heightened overtime leading to fatigue,
recurrent training requirements, which further diminish
productivity.

Ultimately, lost productivity will have a financial impact


which in turn gives rise to disruptions claims in pursuit of
compensation.
What to do when
disruption occurs
When disruption occurs, it is critical to understand the extent
of disruption, the cause, and the impact. To understand the
full picture, a disruption analysis must be conducted.

When analysing disruption in construction projects, it is


essential to apply analytical methods to determine the
impact on productivity and resulting financial losses.
Disruption goes beyond the variance between planned and
actual outcomes.

The goal of a disruption analysis from the Contractor's


perspective is to showcase lost productivity and additional
expenses due to disruption events that the Employer is liable
for, with the goal of securing appropriate compensation.

Compensation is only considered for the consequences of


disruption events assigned to the Employer. Productivity
losses linked to other factors should be excluded from any
claims.

Causes like poor supervision, planning, re-work,


subcontractor coordination issues, and tendering errors don't
automatically justify compensation for disruption.
Disruption analysis
methods
To initiate a disruption analysis, Contractors must assess
productivity trends over time, identify affected work
activities, and review financial implications.

Accurate project documentation is crucial and, if seeking


compensation for disruption, Contractors must present
their claim and supporting analysis with a reasonable
level of certainty required by the Employer, adjudicator,
or arbitrator according to the law.

Even on simpler projects, Contractors must conduct


some level of analysis to estimate productivity losses
caused by disruption events where the Employer is
accountable.

There are three major groups of disruption analysis


methods that can be classified as follows:

1. Project practice based.


2. Industry based; and
3. Cost based methods.
Preparing
a claim
A disruption claim aims to show a decrease in productivity,
resulting in additional costs that wouldn't have occurred
without the disruptive events the Employer causes.

There is no set way to prepare a disruption claim, instead


a tailored approach is required, leaving the claimant to
determine how best to provide a reasonable assessment
of the disruption caused.

The claim should reflect the difference between


achievable and actual productivity levels impacted by
disruption events the Employer is at fault for. Original
tender assumptions should not be automatically regarded
as the baseline for productivity.

As a minimum you need to demonstrate in a disruption


claim the following:

1. Events which entitle it to loss and expense.


2. Identifying the events which caused disruption; and
3. That the disruption caused loss and /or expense.
Compensation

Compensation can be sought for disruption within the


limits set by the contract or if there is a legal basis for it.

Ideally, compensation for disruption due to variations


should be agreed upon in advance or shortly after
completion of the work. Disruption caused by other
Employer-responsible events should be reimbursed
based on actual reasonable costs incurred plus a
feasible profit margin if allowed under the contract.

The financial impact of lost productivity is felt when


executing the affected tasks. However, not all reduced
productivity is eligible for compensation. The Contractor
can only seek compensation for disruption within the
boundaries of the contract terms or under applicable
legal grounds.

Not all contract forms explicitly cover compensation for


disruption, but they address events that could cause
disruption like unforeseen ground conditions or delays in
approvals.
Final thoughts
For Contractors to increase their chances of success when claiming
disruption, it is crucial to identify the precise activities and events
that have experienced disruption and demonstrate, on a cause-and-
effect basis, how this disruption occurred. Additionally, Contractors
need to quantify the losses incurred, backed by contemporaneous
records.

Contractors frequently cite intertwined disruptive events to explain


disruptions, justify productivity losses, and seek compensation for
impacted tasks collectively. While isolating losses tied to individual
disruptive events can be challenging, it is possible with a forensic
approach. Before pursuing a global claim, it is essential to thoroughly
assess the associated risks and dedicate time and effort to a forensic
analysis.

As chartered quantity surveyors and


planning and delay experts, we dig
deeper into the whole contract and
forensically assess the scope of
work, the specification and the
drawings. We compare them to the
current matters in dispute. We then Paul McArd
put forward reasoned technical Managing Director
arguments based on facts and e: [email protected]
evidence so you can settle the
dispute.

Learn more about us


accuraconsulting.com linkedin.com/company/accuraconsulting

Disclaimer: This paper does not in any way constitute any type of legal or professional advice
whatsoever and in no way should be relied upon by any party whatsoever in any jurisdiction.

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