Everyone in construction are asking the same questions right now: What will be the magnitude of delay impacts due to the COVID-19 pandemic? And how will that translate in terms of days and dollars?
Figuring out the answers to these questions require information, and lots of it. The industry is in a unique position to document all progress to date and to record all that is yet to come. Compiling as much data related to project impacts as possible now can put you in better positions to determine the real impact later.
What is worth documenting?
In short, whatever you can. We are firmly in unknown territory regarding COVID-19 impacts, and there is no way to predict when the pandemic will end. Collect enough information to be used in a forensic (i.e., retrospective) analysis so that, when this is over, you can understand the final impacts.
Make sure that you have everything you will (or might) need to document the closure or slow down. Draw a line in the sand by defining what your current project status is now and keep track of effects as the pandemic continues. A future delay analysis using a robust data set will allow decision-makers to determine the merit, magnitude and compensability of any submitted claims.
Every project will have its own unique impacts and requirements. But generally, documenting the following can help you develop the timeline and potential exposure for COVID-19:
- Decrees or orders issued by local, state and/or federal authorities. Document what you were directed to do, how long you had to do it, and all the associated costs of meeting the requirements.
- Internal decisions made to shut down the project. Keep track of when a shut down was ordered and for how long. Include any decisions or discussions with authorities as well as those between the owner, contractors, suppliers, vendors, and designers.
- Extra work required to shut down. Compile the scope, time and cost of any finishing or protective/preservation work; protective and maintenance environmental work; and additional job site security features like guards, fences and barricades. Be sure to also track ongoing data around site maintenance/protective work and security costs required during the shutdown.
- Work you can no longer perform. Keep in mind that the submittal process could continue, so document the work your organization is unable to perform throughout the outbreak.
- Continuing work. Not all projects will come to a halt during the pandemic. Keep a keen eye of the scope, time and cost of what you are able to continue working on.
- Extra work required to start up. Once a project is rolling again, tabulate the scope, time and cost of starting up, including remediation and the dismantling of security measures used during the shutdown.
- Employment records. Understanding COVID-19’s full impact requires a look at who was working, when they worked, and whether or not they worked remotely. Also record other work clearances, like cases where self-isolation or quarantine were needed and when an employee returned to work.
Remember to also examine the ripple effects. Not only for projects at large, but also for the affected suppliers and manufacturers that may be struggling to get their production facilities back to full operating volume and meet supplier agreements.
Five ways to maximize downtime
Beyond tracking impacts, use the shutdown or slowdown time to complete tasks you wish you had more time for. For starters, you can:
- Review CPM schedules. Make sure you have the approved versions from which to measure delays. Confirm they are up to date with actual dates, percent completes and forecast to complete information. If appropriate, revise and add more detail to ensure a CPM schedule is an effective management tool.
- Revisit contracts. Look closely at the agreements so that your teams understand what must be documented and when it must be submitted for any delays.
- Organize your emails and documents. Put a dent in your inbox by reviewing unread messages, deleting spam and other non-work-related messages, and creating folders that make it easier to quickly find project communications. Likewise, consider reworking your filing structure to rename/renumber files so that they are stored sensibly and chronologically.
- Visually record sites. Take photos and videos of project sites, and then organize the files in a way that makes them easy to retrieve and use later.
- Track other shutdowns/slowdowns. Don’t let non-COVID-19 shutdowns and slowdowns fall by the wayside. They might not be as pressing today, but documenting information will be helpful long-term.
Document, document, document
It’s an unusual time for construction, and the entire sector will soon be faced with a surge of delay claims to wade through. Remember, above all, to document everything. Data will be the most important asset in determining the COVID-19 delay impacts.
If you have questions regarding COVID-19’s effects on your project agreements or any other contract solutions needs, contact our General Contract Solutions team to find out the ways we can help.
