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What does NEC4 clause 60.1(8) mean?

It is a compensation event when the Project Manager or the Supervisor changes a decision that was previously communicated to the Contractor.

Updated: 15 September 2026. By Jack Butler-Kettle, Quantity Surveyor & Claims Consultant.

The answer

Clause 60.1(8) covers the cost of a reversed decision. The event is that the Project Manager or the Supervisor changes a decision previously communicated to the Contractor. Two things have to be shown: a decision that was communicated to the Contractor in the form the contract requires, which means in writing and separately from other communications, and a later communication that changes it. A decision is wider than an instruction; it includes an acceptance of a design or a Subcontractor, an agreement about a method, and a Supervisor's decision on a test result. The paragraph does not ask whether the change was reasonable, only whether it happened; the Contractor-fault filter is applied under clause 61.4, so a decision changed because the Contractor's own information was wrong produces no change to the Prices. Because the event arises from the Project Manager's or the Supervisor's own communication, the Project Manager notifies the compensation event when the changed decision is communicated; if it does not, the Contractor notifies under clause 61.3, without the eight week bar because the Project Manager should have notified it. The change to the Prices is assessed under clause 63.1 as the effect of the changed decision on the actual Defined Cost of work done by the date of the communication and on the forecast Defined Cost of work not yet done, plus the Fee, so it captures abortive work done in reliance on the first decision as well as the cost of doing it the second way. What most often goes wrong is that the first decision was only ever verbal or buried in meeting minutes and the Project Manager denies it was a decision, or that the Contractor claims the whole cost of the second approach rather than the difference the change made. Any delay to the Completion Date is assessed separately under clause 63 by the programming expert.

Example

The situation

An electrical contractor asks the Project Manager whether cable containment in the ground floor corridors may be surface mounted above the ceiling line, and the Project Manager decides in writing that it may. Four corridors are installed that way.

What happens

  1. The Project Manager communicates a changed decision requiring the containment to be concealed within the ceiling void, and notifies the compensation event with it.
  2. The quotation assesses under clause 63.1 the abortive Defined Cost of stripping out the surface mounted runs already installed at £9,800.
  3. It adds the additional cost of the concealed installation over the surface mounted one at £6,200, a change in Defined Cost of £16,000.
  4. With a fee percentage of 7 per cent the Fee is £1,120 and the proposed change to the Prices is £17,120.
  5. The quotation attaches the first written decision, the record of the installed corridors and the second communication.

The quotation in figures

ItemAmount
Stripping out the installed runs£9,800
Concealed installation over surface mounted£6,200
Change in Defined Cost£16,000
Fee at 7 per cent£1,120
Change to the Prices£17,120

The outcome

The quotation goes in at £17,120 with the two decisions and the installation record attached, so the sequence is not in dispute.