How to calculate suspension reimbursement?
In the Open Standard
Dana QandahMember for 20 years 2 months
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The following costs are recoverable during a suspension period:
1. Demobilization and remobilization costs.
2. Idle manpower.
3. Idle equipment.
4. Depreciation on fixed assets
5. Site overheads.
6. Head office overheads.
Any other suggestions/ breakdown?
But will the number of staff remain the same? What if the contractor couldn’t minimize it ? Can the contractor reimburse their salaries as if they are working full hours?
Assume the suspension is from the owner.
What about equipment,? Depreciation or rental cost?
1. Demobilization and remobilization costs.
2. Idle manpower.
3. Idle equipment.
4. Depreciation on fixed assets
5. Site overheads.
6. Head office overheads.
Any other suggestions/ breakdown?
But will the number of staff remain the same? What if the contractor couldn’t minimize it ? Can the contractor reimburse their salaries as if they are working full hours?
Assume the suspension is from the owner.
What about equipment,? Depreciation or rental cost?
3 replies
Oldest first- 0Brennan Westworth ·Start with the contract, it will outline how suspension of the works is to be treated. (cost, cost + margin, schedule of rates)
Your headings look good, you should include idle staff cost too. In a recent delay claim we included a section on idle staff claiming the full rate for the delay duration without resistance from our client.
It would be good to show that you have considered the clients interests by comparing demob / remob cost to standby cost for hired plant.
As for depreciation or rental cost, I would start with a list of all equipment and calculate each based on wether it is owned or hired.
- 0Charleston-Joseph Orbe ·Hello Dana,
Be sure to document everything, including as an example nails used to maintenance, the number of dettols used, etc. This are minor items that if added, during the suspension period, will be increase substantially.
In words, keep the official receipt of merchandise, timesheet of employees, payroll and proof of payments, etc.
Cheers,
Charlie
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