Delay and

Disruption
By Richard Morris
Head of Expert Services
What are delay and disruption? Mitigation or acceleration? How to demonstrate disruption As noted in Section 18 of the SCL Protocol, with disruption
Core Statement 15 of the SCL Delay and Disruption Protocol claims:
‘Disruption’ and ‘delay’ are two terms that are regularly used in states: Productivity loss (disruption) “Compensation may be recovered for disruption only to the
the same breath as they often flow from the same event. But “The Contractor has a general duty to mitigate the effect on Disruption is usually lost productivity, i.e. an increase in extent that the contract permits or there is an available cause
you can have delay without disruption and vice versa as we its works of Employer Risk Events. Subject to express contract the resources required to carry out a unit of works from the of action at law. The objective of a disruption analysis is to
will see later in this [Link] events may not necessarily wording or agreement to the contrary, the duty to mitigate does “baseline” levels. demonstrate the loss of productivity and hence additional
have a direct impact on the critical path or delay damages but not extend to requiring the Contractor to add extra resources or loss and expense over and above that which would have been
just affect individual [Link], disruption, unlike to work outside its planned working hours.” It is essential to identify the cause (an event, events, or incurred were it not for the disruption events for which the
delay, has a direct consequence on financial loss. Therefore condition(s) that have led to the productivity loss), the Employer is responsible.”
a disruption analysis should not be confined to events that Under English Law, an injured party cannot recover damages entitlement (a clause in the contract or entitlement at law
are on the project’s critical path. for any loss which could have been avoided by taking that gives the contractor the right to claim for loss and Hence, analytical methods and techniques should be
reasonable steps, but the onus is on the defendant to prove expense arising from the cause), deal with separation (where used to establish the loss of productivity arising out of the
So, what is disruption? any failure to mitigate. the productivity loss is distinguishable from productivity loss disruption events and the resulting financial loss, rather than
The Society of Construction Law (“SCL”) Delay and Disruption for which there is no entitlement for recovery) and finally the merely claiming the difference between what the contractor
Protocol (2nd edition , p9) defines disruption as: The object of acceleration is to reduce the time taken to carry loss must be measured. There are two ways to do this: planned and what actually happened, i.e. the contractor
“… disturbance, hinderance or interruption to a Contractor’s out a task or a series of tasks usually with a view to mitigate a must demonstrate the lost productivity and resultant loss
normal working methods, resulting in lower productivity or delay that has occurred or likely to occur. Time has been incurred as a result of employer risk events only
efficiency in the execution of particular work activities.” An activity should take 10hrs/m2 but it actually takes 15hrs/ (i.e. excluding contractor risks).
There are two principal types of acceleration, express and m2, hence the productivity is 10/15 = 66% (or a loss of 5hrs/
Disruption requires the demonstration of entitlement, constructive. m2); or The Measured Mile Analysis
causation and damages. It’s easier to prove delay – which is This is generally based on the premise that:
a matter of fact – than to demonstrate disruption. Express acceleration Cost - At certain periods of the works there are times when the
Where an employer risk event delays a project but the An activity should cost $10/m2 but it actually costs $15/m2, progress is not disrupted (unimpacted portion)
Demonstrating disruption is more of an art than a science, employer still wishes to retain the original date for completion hence the productivity is 10/15 = 66% (or a loss of $5/m2). - During these periods a “standard” or “baseline” rate of
however there are guidelines and procedures to follow for an and gives an instruction to accelerate – where permissible production can be established
analysis to be acceptable and effective. under the Contract – the measures to be taken and the basis There are several distinct methods for the calculation of - By comparing with the output during periods when
of payment should be agreed beforehand. lost productivity resulting from disruption events, each with disruption arises from claimable disrupting events it
Extensive and detailed records are a key requirement for a varying accuracy and general acceptance. should be possible to identify that the rate of production
successful claim for disruption. Constructive acceleration - A Measured Mile Analysis compares the difference in is lower (“workhours lost”)
Core Statement 16 of the SCL Delay and Disruption Protocol productivity between the impacted (disrupted) period - Where this occurs it can be claimed that there is a loss
If there is only one activity and that activity is delayed by the continues: to that of an un-impacted period and is the preferred of productivity due to events or conditions for which loss
procuring party, then under most forms of contract the delay “Where the Contractor is considering implementing methodology to adopt and expense can be claimed.
to the activity may be claimable as an extension of time and acceleration measures to avoid the risk of liquidated damages - EVA (Earned Value Analysis) compares earned resource
any delay costs may be recoverable as well. (See Figure 1). as a result of not receiving an EOT that it considers is due, and value against planned tender recovery, but should not be The loss and expense during this period is usually claimed
then pursuing a constructive acceleration claim, the Contractor (mis)used to recover tender errors. in man-hours although it is not incomprehensible that there
However, there remains a cost in demobilising and should first take steps to have the dispute or difference about - Work Sampling relies upon contemporaneous records will be additional costs in construction plant and possibly
remobilising the labour working on the activity and this will entitlement to an EOT resolved in accordance with the contract of direct works observations to determine productivity, materials, but this is often more difficult to establish. During
be the disruption cost. dispute resolution provisions.” effectively people watching and recording time and these periods a “standard” or “baseline” rate of production
output. can be established, as shown in red in Figure 5.
Over this single activity the disruption is easy to identify, As there is no prior agreement or instruction for this type of - System Dynamic Modelling is a computer simulation
however, where multiple activities are affected, the acceleration, the contractor places itself at risk when taking approach using specialist software to produce a model Figures 6 and 7 show an example where there were a series
disruption costs become more difficult to establish and such measures, so before instigation the contractor should of the disrupted project. of identical power generation units under construction.
measure. give notice to the employer of those measures and issue a - Project Comparison Studies may be used when there A number of causes of disruption affecting Unit 3 were
revised [Link] of acceleration include the are insufficient records available to carry out a project- identified by the contractor [who kept excellent labour
Where several events which affect the progress of the increase of resources (number and hours), but note that a specific study. Productivity on the disrupted project is allocation records for its operatives], that had not affected
works are disrupted the impact of any one event may not be Business Roundtable Report from November 1980 entitled compared to similar or analogous projects. Unit 2.
discernible from the impact of another event. (See Figure 2) “Scheduled Overtime Effect on Construction Projects” has - Industry Studies can be used in instances where there
key findings including this: are insufficient records or documentation. They can be Records, records, records
Disruption is not a cause of action at law in its own right and “Where a work schedule of 60 or more hours per week is used for projects that are disrupted by severe weather; To achieve be able to demonstrate disruption, it is vitally
the contractor must explain the legal basis of entitlement. continued longer than about two months, the cumulative effect these studies can provide factors which account for important to have accurate project records … and more
Most standard forms of contract do not address recovery of decreased productivity will cause a delay in the completion changes in temperature and their effects on tradesmen records … and even more records including schedules
for disruption but may give entitlement to claim some of the date beyond that which could have been realized with the same practices and productivity. (original and regularly updated), progress reports,
events that could lead to it in the form of loss and expense crew size on a 40-hour week.” - Cost-based methods provide the least robust support correspondence, resource records (who, when, where and
or damages. for a disruption claim and are often applied when lost what) and cost records.
This is shown on the following graph Figure 3 plotting output productivity cannot be reliably calculated utilising a
When it comes to explaining the cause of reimbursable against time which shows that a productivity rate of 65% in productivity-based approach, such as a “global claim”. In the English case of Van Oord UK Ltd and another v Allseas
disruption, contractors often rely upon multiple and relation to a 60 hour worked week (i.e. the equivalent of a 40 UK Ltd (2015), the contemporaneous documents failed to
intermingled events to explain loss of productivity and hour week) is reached after only 10 weeks. There is also a trade-off between the persuasiveness and credibly support the claims: the contemporaneous evidence
entitlement. ease of applying the methods, which is shown in Figure 4. made little reference to the standing time and disruption
Express acceleration being claimed in the Court proceedings. This, coupled
Once those items that can be dealt with in isolation have been Where an employer risk event delays a project but the with the lateness of the claims being made, were factors
quantified, it may be acceptable to deal with the remaining employer still wishes to complete the project by the original undermining the credibility of the claims and the case was
disruption globally. However, the bar for acceptance of a date for completion and gives an instruction to accelerate lost.
global claim is very high and therefore carries significant – where permissible under the Contract – the measures
risks. to be taken and the basis of payment should be agreed
beforehand.
Figure 1 Figure 3

Figure 2

Figure 4
Figure 5 Figure 7

Figure 6
The consultant of
choice on major
global projects

[Link]