NEC3 Contracts Explained

The NEC which stands for New Engineering Contract are a suite of contracts used in construction which aim to provide a collaborative, forward thinking approach to projects. In this article we’ll be exploring the selection of contracts available under the widely popular NEC3 contract.

Engineering and Construction Contract (ECC)
– This is the most commonly used contract form and contains all the characteristics of the NEC. This contract is mostly used between a main contractor and client. Within this contract there are six options of which the Employer will choose what they believe will achieve the best value.

The Engineering and Construction Subcontract (ECS) – This contract is very similar to the above. However, it allows for the main contractor to sub-let part of the project to a subcontractor. This allows for back to back clauses. The only difference is a change in names (i.e, contractor and subcontractor) and time scales are altered to facilitate the timescales required in the ECC contract.

The Engineering and Construction Short Contract (ECSC) – This contract is a cut down version of the ECC and is to be used when the work carried out is considered to be low risk. Similar to ECC this is for an Employer/Contractor agreement.

The Engineering and Construction Short Subcontract (ECSS) – Clauses within this contract are back-to-back with the ECSC. However, is used for a contractor and sub-contract agreement.

The Professional Services Contract (PSC) – To be used for anyone who provides a service. For example, contractors carrying out design work. This ensures that although the design is produced for a contractor or employer, they would also be signed up to follow the clauses within the contract.

The Professional Services Short Contract (PSSC) – For less complex assignments carried out under the PSC. This contract is often used for a small team managing the administration of the ECC on behalf of the Employer.

Framework Contract (FC) – This is an umbrella contract which is used over an agreed length of time. Within that timeframe, work is let under a number of different call-off contracts. This means parties will adhere to the headline clauses within the framework contract while following the job specific clauses within the call-off contract. The Framework Contract is often very slim compared to the other contracts.

Term Service Contract (TSC) – For a project which is operational or maintenance based. For example, maintaining a highway asset like street lighting. It will be the contractors responsibility to maintain the asset and ensure a certain standard is kept for an agreed length of time. This contract isn’t generally used for constructing new works. There is also a short form version of this contract for low risk work.

Supply Contract/Short Supply Contract (SC/SSC) – This contract is specific for a supplier of supplies or goods. The purpose of the contract is to put a contractual responsibility on the supplier during construction project life cycle. The Supply Contract is for big project specific items which are designed and manufactured specially for that contract. The Short Supply Contract is for more general supply of goods to a project. Neither of these contracts cover site working.

Adjudicator’s Contract (AC) – To be used when there is a dispute between parties on a project. The Adjudicator will follow the clauses within this contract.

Why not check out our video on NEC3 contracts:

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