Covid-19 has a dynamic impact on the world. It has significantly influenced the construction industry hindering the projects, causing Delays and disruptions. It is because of fewer movements of labor, limited access to materials, and increasing risks of health and wellness.
The article aims to help the people get a comprehensive understanding of claims for finance increase or extension in the overall project duration. Keep reading to gain in-depth insights!
Impact of Coronavirus on Contraction Industry: Overview
The construction sector is a multi-dimensional industry that requires active collaboration with suppliers, material providers, equipment rental companies, labor provider services, and much more. The disruption in any of the following can have a significant adverse impact on the construction sector.
Unfortunately, the coronavirus pandemic has deterred the normal working in every business leading to slow working and lack of resource availability. Therefore, the contractors face serious issues related to project management in construction. All this caused confusion and disputes among the contracting parties for compensations and time extension.
So, the claims for time and monetary compensation are inevitable. It’s more to the viewpoint of the contractors as they have to initiate the claim procedures in time for resolving the disputes without further delays.
Do you face the same? Go through the post to get guidance for dealing with claims in construction amid the Coronavirus pandemic.
Top ways for dealing with time and money claims in construction
Nevertheless, the construction industry is facing severe consequences of the pandemic eruption directly and indirectly. It is imperative to understand the critical aspects proactively for managing the risks of project suspension.
Let’s consider some ways to deal with unexpected claims regarding the financial matters and time extension requests:
Analyze the scenario critically
Firstly, it is essential to review the project progress while keeping the whole Covid-19 situation into consideration. It helps in dealing with the delays face by the contractors. Similarly, the project owners get a justification for resolving the claims for additional time requests in construction.
In any case, if the contractor is facing trouble owing to delayed construction, it is better to acquire the services of an experienced delay expert for figuring out the facts. Usually, a time extension is given to the contractors if the project faces delays owing to natural calamities and uncontrollable circumstances.
Get benefits from the economic stimulus package
The world has realized the losses and setbacks as a result of Covid-19. The government institutions are trying to mitigate the negative impact by introducing different relaxation packages for the business industries.
For instance, the Crown Prince of Dubai, H.H. Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum who is also the Chairman of the Dubai Executive Council, has announced an economic stimulus package amount AED1.5 billion. The construction contracting companies can take benefits from this package for mitigating the financial risks.
Consider the contract for the extension of time
The contract ruction project requires massive investments. Owing to this, contracting parties usually sign the contracts having a comprehensive detail for dealing with uncertainties and risks. The sub-clause 20.1 usually deals with the project completion while the sub-clause 10.1 deals with the purpose of time extension.
You can go through the clauses for a better understanding of your rights and responsibilities while asking for more time to complete the project in construction. Don’t forget to consider the variation procedure for a substantial modification in the project working under certain conditions.
Use Force Majeure Clauses for project suspension
Last but not least, it is one of the most critical consequences caused by Covid-19 as many contractors are forced to leave the project owing to the suspension or termination of their contracts. The contracting parties use the force majeure provisions under the contract governing laws. However, the contractors can use the arbitration amid Covid-19 force majeure for resolving the issues.
If you are facing such circumstance, you can get assistance from experienced delay expert for analyzing the impact of coronavirus on the project for getting compensation. It is because a delay amid the pandemic is out of your control!
Get time and financial compensation in construction projects!
Summing up, the eruption of Coronavirus is declared as the global pandemic owing to a widespread impact on the whole world. Many countries have declared the state of emergency which disrupted the normal life affairs. It has a grave effect on the businesses leaving many projects in a disastrous condition.
There is no denying that increased restrictions of mobility and collaboration have restricted the construction-site activities. It also affected the materials acquisition and labor availability. In this way, the contracting parties have compelled to fight for the projects along with fight against the pandemic.
At this point, the construction managers and contractors should adopt an approach of reconciliation instead of getting into disputes. The best way is to look for possible ways to resolve the claims peacefully by giving time extension and find a middle way for financial management.
Don’t forget to consult with the industry experts for handling claims in construction. Hopefully, you will find the best solutions!