Electricians Strike and the New GCCC Forms the First Major Test

The current Electricians Strike affecting the industry is going to cause havoc for both Employers and Contractors alike in dissecting the provisions of the New GCCC forms.

Present Contracts signed up to these forms and this occurrence will certainly be the cause of disputes between contracting parties.

Schedule K (item 14) in the standard forms reads as follows:

K Delay Events, Compensation Events, Programme Contingency, Delay Costs, Adjustments

A strike or lockout affecting the construction industry generally or a significant part of it, and not confined to employees of the Contractor or any Contractor’s Personnel.
Delay Event - YES
Compensation Event - NO

So lets pose the following scenario's. We will deal with the Delay Cost first.

1 - A contractor rates out his delay event weekly cost schedule at a certain cost per week. To remain competitive any Tendering / Competing Contractor will only allow his overhead cost per week in this rate. It should be noted that this is just a lump sum per week and one cannot break this figure down further.
2 - Experience tells us that a Contracting firm can endure differing levels of overheads at different stages of a contract, i.e. site set up costs are high at the start, even out through phases of a project and management has the same curve with perhaps a decreasing level of management costs as a contract nears completion.
3 - What level and time frame does the 'lump' sum cover for? If this strike is at the peak level on some contracts then has a contracting party a right to additional cost for this strike?

Where does a Contractor now stand in relation to Compensation?

1 - As with all clauses in a form of Contract / Agreement no cluase can be breached, this applies to the pay and conditions clause 5.3 of the GCCC's.
2 - Now we have a scenario were a strike has occurred due in part to perhaps a breach of an agreement outside the Contract, so does the breach outside the Contract in turn cause a breach within the Contract? Lawyers are requested to intervene by this blogger here!
3 - If this is not a Compensation Event then Contractors will probably avoid paying the other site workers even an 8 hour shift per day, which is their loss of wages due to the strike. In other words they will just pass the condition thrown upon them by the GCCC down the line to the workers and refuse to pay employee's and/or sub-contractors.
4 - If they do this are they then in breach of the pay and conditions clause?

Interesting times await Conciliators trying to resolve any disputes over additional claims for payment in the form of Contractors Compensation due to this Electricians strike.....