Contractors’ Perspectives of Delays in Healthcare Projects: A Tale of Two Contrasting Provisions

Abstract

Many construction projects are delayed due to a range of factors, including the unique spatial and environmental context of every construction site, the challenges of maintaining quality, and the timing of decision making around design. In consequence, construction contracts include mechanisms to accommodate delay while maintaining enforceability. Different standard forms of contract (SFC) adopt different approaches to managing delay and lack consistency in accommodating delays of the same nature. This study selects two SFCs commonly used in UK construction projects, new engineering contract (NEC) and joint contracts tribunal (JCT) suites, and proposes a common approach to managing delays, focusing particularly on the handling of the compensation event (CE) and relevant event (RE) mechanisms in those respective contracts. Using a qualitative methodology, a multi-case study analysis was conducted comprising four general contractors utilizing JCT and NEC SFCs. The case studies enabled the analytic comparison of delay-caused challenges as between different projects delivered using different SFCs. The findings reveal that while on JCT-based projects general contractors have typically suffered cash flow and programming issues caused by employer failures to adhere to contractual time scales for assessing requests for extensions of time, on NEC-based projects general contractors have suffered CE-related issues associated with programming and administration. Further findings were that the common challenges of both CE and RE management processes were high volume, assessment and time scales of claims, as well as timing and collaboration. Developing from these findings, recommendations are made for additional clauses to be added to SFCs to achieve a consistent approach toward construction delays. By examining delay management under two widely used standard forms of contract in the UK—the new engineering contract (NEC) and the joint contract tribunal (JCT) suites—this research not only identifies specific implementation challenges inherent in these contracts but also offers recommendations on how to address such challenges. Contractors using JCT contracts often face cash flow and scheduling issues due to employer delays in assessing extension of time requests, while those using NEC contracts encounter complexities with compensation events. To address these issues, the study proposes incorporation of additional clauses in contracts to standardize delay management, which can significantly enhance project outcomes. Furthermore, the research underscores the importance of collaborative contract management practices, particularly in NEC contracts, to mitigate delay-related challenges and promote timely project completion. These findings are crucial for industry professionals seeking to improve project efficiency, minimize disputes, and achieve successful project delivery. By adopting the recommended strategies, practitioners can enhance their approach to managing delays, ensuring smoother and more predictable project execution in the healthcare construction sector. The Institution of Civil Engineers and the Joint Contracts Tribunal, both responsible for publishing these contracts, and other institutions with similar provisions are also likely to find these recommendations useful when revising their contract documents.