Compensable Delays

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Third Party Procurement

Frequently Asked Questions

Q = Question; A = Answer

Q. I have a contractor who is asking for additional funds, claiming a number of delays caused by our agency:

  1. Delayed in getting access to the area because of trouble with access badges.
  2. Could not work due to a misunderstanding of holiday hours. Showed up before the facility opened due to holiday hours, went home when no one opened the facility.
  3. Claiming a 3-hour delay due to a tripped safety switch which shut down mechanical operation of a system, which we believe was the contractor’s fault.
  4. Claiming a 1-hour delay due to a facility loading dock that was frozen, and therefore they could not unload their truck.

A. The Best Practices Procurement Manual (BPPM) discusses "Delays" in section 9.2.3.5, and the paragraph entitled "Compensable Delays" may provide some help in resolving the issues you raise.

It is not clear from the information you present that your agency unreasonably delayed the contractor, but that is a judgment call for you and your counsel based on the facts. For example, was the contractor led to believe it could work on a holiday when the agency's offices are usually closed? The contractor should have known the offices would not be accessible on a holiday. As far as the frozen loading dock, weather problems would not normally be a compensable delay based on the owner's failure and especially if the agency acted expeditiously to solve the problem in one hour. The security badge situation is not defined enough for us to express an opinion, but the agency needed to ensure that the contractor had access to the site when he was scheduled to work. Did the contractor have any responsibility in obtaining these badges, or was the agency at fault in not having them available when they were needed by the contractor? The tripped safety switch could be either party's responsibility depending on the facts. Should the agency have warned the contractor about the switch, or should the contractor have known of the switch even without the agency's warning? Was the agency negligent in not supervising the contractor at the site of the work (given the safety switch, etc.), or was the contractor negligent in tripping the switch by doing something it was not supposed to do? We would suggest  your counsel review each of the circumstance raised by the contractor to ascertain the relevant facts and to determine whether your contract clauses treat the circumstances as compensable delays. (Reviewed: September 4, 2009)

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