COVID-19 Impacts on Construction
COVID-19’s impact on construction projects and parties have been
varied. Some owners have been forced to defer capital projects, adjust project completion expectations or shut down construction sites altogether. Owners of other ongoing construction projects have been largely unaffected due to the nature of their construction project or the regulations at their location.
Whether a project is significantly impacted or largely unaffected, parties to a construction project should review their contracts for guidance on how to address the impacts associated with COVID-19. Certain contractual provisions regarding delay, disruption, changes, damages and force majeure may be relevant.
Ideally, documentation of the project status has been created on a regular
basis, including at the outset of the impacting event. Impacts should be tracked and recorded in as much detail as possible, including steps taken to mitigate the associated delay or cost increases. This can be done through project schedules, daily logs, weekly COVID-19-specific reports, photographs or other means. Whatever the means of documentation, it will likely be helpful in a dispute situation to have supporting records with as much detail and specificity as possible.
We’re challenging clients to do more than simply create a list of possible impacts. Circulate the list among the entire project team, and document as much as possible in the schedule or separate tracking log. Tie impacts to specific schedule activities or items in the job cost report so that there’s a good record established linking impacts to delays or cost growth.
Communication and documentation are critical to managing issues related to COVID-19. Schedule impact and cost overrun information should be sought from subcontractors, suppliers, owners and other project stakeholders. It takes a collaborative effort to get as much quality information as possible.