Disruption claims in construction
In construction contracts, the term 'disruption' refers to a loss of productivity due to a hindrance or interruption of the progress of the construction works which reduces the rate of efficiency.
If disruption is caused by the employer, the contractor may have grounds to seek compensation. Disruption, and claims arising to try and recoup losses incurred from it, are common on construction projects, particularly on larger and more complex projects.
The difference between disruption and delay is that the latter relates to lateness rather than productivity, although they can often be related. Delays can cause disruptions, and vice versa. Despite their inter-relation, they require a different approach to assessing claims.
When evaluating claims for delay, the terms of the specific contract are the usual starting point, and evidence is required that certain circumstances caused the delay. The terms of the contract are less useful when evaluating disruption claims. Instead, the contractor must provide reasonable evidence that:
- Progress of the works has been disrupted.
- Which element of the works and which trades have been disrupted, why losses occurred, and so on.
- The disruption incurred additional costs.
- The cause of the disruption constitutes a breach of contract.
Evidence will normally take the form of documented records demonstrating that disruption caused losses. However, this can prove difficult as the contractor can often not detect disruption until after it has occurred. In addition, isolating the loss of productivity to the cause of the disruption can be difficult as it may coincide with several other factors, and the effect of the disruption may be hidden by other issues.
Several methods can be used to estimate loss in relation to disruption, including:
- Measured mile analysis: Compares actual labour performance between two periods – a normal measured mile period and an impacted period.
- Baseline productivity analysis: A more conservative estimate used when an unimpacted section of the works is too difficult to isolate.
- Earned value analysis: Compares the amount and cost of work that was planned to have been done by a particular stage with the amount that has actually been done and what it has actually cost.
NB The term ‘disruption’ can also refer to the impact of new technologies and techniques on an industry. For more information, see Construction is an industry ripe for tech disruption.
Anticipate, react, recover; Resilient infrastructure systems, published by the National Infrastructure Commission in May 2020, defines disruption as: ‘A disturbance which interrupts the usual functioning of an infrastructure system or service, and its impacts.’
[edit] Related articles on Designing Buildings
Featured articles and news
Twas the site before Christmas...
A rhyme for the industry and a thankyou to our supporters.
Plumbing and heating systems in schools
New apprentice pay rates coming into effect in the new year
Addressing the impact of recent national minimum wage changes.
EBSSA support for the new industry competence structure
The Engineering and Building Services Skills Authority, in working group 2.
Notes from BSRIA Sustainable Futures briefing
From carbon down to the all important customer: Redefining Retrofit for Net Zero Living.
Principal Designer: A New Opportunity for Architects
ACA launches a Principal Designer Register for architects.
A new government plan for housing and nature recovery
Exploring a new housing and infrastructure nature recovery framework.
Leveraging technology to enhance prospects for students
A case study on the significance of the Autodesk Revit certification.
Fundamental Review of Building Regulations Guidance
Announced during commons debate on the Grenfell Inquiry Phase 2 report.
CIAT responds to the updated National Planning Policy Framework
With key changes in the revised NPPF outlined.
Councils and communities highlighted for delivery of common-sense housing in planning overhaul
As government follows up with mandatory housing targets.
CIOB photographic competition final images revealed
Art of Building produces stunning images for another year.
HSE prosecutes company for putting workers at risk
Roofing company fined and its director sentenced.
Strategic restructure to transform industry competence
EBSSA becomes part of a new industry competence structure.
Major overhaul of planning committees proposed by government
Planning decisions set to be fast-tracked to tackle the housing crisis.
Industry Competence Steering Group restructure
ICSG transitions to the Industry Competence Committee (ICC) under the Building Safety Regulator (BSR).
Principal Contractor Competency Certification Scheme
CIOB PCCCS competence framework for Principal Contractors.
The CIAT Principal Designer register
Issues explained via a series of FAQs.