April 22, 2020
In Revay’s previous article, we discussed some of the impacts the construction industry has been facing due to COVID-19, along with the importance of recording and documenting issues, lost time and additional costs stemming from the situation in order to facilitate the resolution of disputes later on.
As the current COVID-19 situation continues to affect the construction industry, Revay would like to remind all our clients of another important consideration: the duty to mitigate the impacts of COVID-19 related disruptions. Looking beyond the duty to mitigate, Revay also sees an opportunity for the construction industry to come back stronger after COVID-19 by taking time to address other common construction risks.
Whether your project has been slowed down due to COVID-19, or your project site has been shut down completely, there are many ways for project teams to look for opportunities to mitigate the impacts of COVID-19 as well as other risks. To the extent possible, there are opportunities for parties to use this downtime to reassess their projects, by both revisiting existing project risks and identifying new project risks. Revay offers the following considerations and opportunities, some of which relate to common issues affecting projects, even during normal times:
REDUCE COMMON DESIGN AND PROCUREMENT RISKS
- Advancing project designs and collaborating with suppliers and contractors;
- Engaging with contractors more regarding constructability in design;
- Advancing procurement to address common supply chain issues such as late supplier engagement or late material delivery; and
- Resolving design issues to reduce Requests for Information (“RFI”) when work resumes.
RESOLVE OUTSTANDING CONTRACT ADMINISTRATION RISKS
- Addressing and resolving outstanding change orders, RFIs and other administrative responsibilities;
- Following up on outstanding submittals, including shop drawings, close out requirements, notices, etc.;
- Updating current as-built schedules and site conditions to reflect project conditions before COVID-19 impacts started; and
- Updating and organizing project management items such as quotations, change request submittals, change logs, drawing logs, etc.
ADDRESS NEW RISKS RELATED TO RESTARTING WORK AFTER COVID-19
- Carefully training workers with respect to new and evolving COVID-19-related safety procedures and retraining workers with respect to other safety procedures;
- Developing comprehensive recovery plans that consider labour, equipment, material, and subcontractors;
- Reviewing and optimizing the planning and sequencing of work as a collaborative effort with owners, contractors, subcontractors, and suppliers;
- Considering and identifying all possible opportunities to reduce and/or mitigate costs, schedule delays and productivity losses, including acceleration; and
- Effectively rolling out new procedures, recovery plans and schedules to all project stakeholders.
MITIGATE IMPACTS OF LOST TIME OR ADDITIONAL COSTS
- Evaluating the costs related to new work procedures, schedule delays, productivity impacts, increased labor rates, amongst other impacts;
- Preparing for or defending against possible claims by recording all events and tracking costs using separate cost codes – construction claims consultants can aid in schedule updates and claims preparation; and
- Initiating discussions with respect to resolution of additional costs and schedule impacts as early as possible.
While the opportunities may differ depending on what stage your project is at, proactive behaviour will help alleviate and mitigate impacts encountered. Working together to mitigate existing or new risks while work is slowed or suspended will allow for a more seamless restart and improved collaboration moving forward.
Your projects, and the construction industry as a whole, will come back stronger if all parties work together and seize all available opportunities during this slow down or shut down time.