The Construction Leadership Council has urged the industry to work together to constructively resolve contractual disputes arising from the pandemic.

CLC COVID-19 Guidance

The guidance is endorsed by the Government, reflecting the national interest in protecting jobs and the economy.

Recommendations include:

  • Parties should discuss whether extensions of time can be granted and additional costs shared (although it is imperative that contractual mechansims are strictly followed until agreement is reached).
  • "Without Prejudice" negotiations can be used to create a safe space for collaborative dialogue.
  • Parties should consider waiving any termination triggers and/or mutually agreeing to temporarily suspend works if necessary.
  • Valuations could be adjusted to assist contractors and their supply chains, with employers taking other forms of security.

The guidance includes useful pro-forma letters and contractual notices for the parties to use.

In practice, we have seen employer and suppliers adopting a wide range of responses, from collaborative engagement to the first COVID-19 related disputes, often driven by the financial concerns of the respective parties