Contractors often shoot themselves in the foot when preparing progress updates for the employer’s team. Many times, we see months’ worth of updates that present a rose-tinted view of project progress.

While it may be tempting to keep reporting good news month after month, be wary. A less-than-competent consultant may believe such reports because good news will not involve them in additional and troublesome work. However, you could be causing problems for yourself further down the line.

Problems frequently arise when the contractor needs to submit a claim for an extension of time. It becomes very difficult for them to subsequently tell the employer’s team: “I know we kept telling you that there was no delay to the completion date, but actually there is, and it’s not our fault, so please can I have an extension of time.”

A progress update, as-built programme, or updated programme (all different names for the same thing) is created using the latest agreed programme. It uses planned start and finish dates plus the percentage of progress for any activity started but not finished. The logic contained in the programme and the programming software will then predict the completion date based on progress to date.

Before I specialized in contractual matters and claims, I was a project manager for both contractors and consultants. When my planning team produced a progress update, I wanted only one thing from them, and that was…

THE TRUTH.

If the update predicted early or on-time completion, then I knew we were doing okay. But if the update was predicting a delay, I needed the planners to tell me the cause, or causes, of the delay so that we could take action.

If the delay was caused by us or was due to something that we were responsible for under the contract, we had to find ways to recover the delay. This could mean working longer hours or mobilizing additional resources.

But what if the delay was caused by the employer or by something that is at the employer’s risk under the contract? In this case, we needed to identify the cause, submit the necessary notices, and make preparations to submit a claim.

So, what would I report to the employer’s team in our monthly progress reports under such circumstances? Again…

THE TRUTH.

Many contractors will not agree with this tactic and will be reluctant to tell the employer’s team that the project is in delay for any reason at all. The contractor should admit to their own delays but explain the steps they are taking to mitigate them. Generally, the employer’s team will accept that delays do happen and will appreciate that the contractor is being proactive in dealing with them. Telling the employer’s team about predicted delays will only support subsequent claims, particularly when the cause is something that will entitle the contractor to an extension of time.

This, of course, only works if the contractor does not simply bury their head in the sand and hope that the delay will go away. Trust me, it probably won’t. The contractor must actually take mitigating action to recover their own delays. Make sure to send the necessary notices and submit a claim without undue delay.

So, what is the alternative to telling the employer’s team THE TRUTH? Manipulate the programme so that it no longer predicts a delayed completion date? Unfortunately, this is what many contractors do to avoid giving the employer’s team any bad news.

The fact that this knee-jerk reaction is not sustainable through multiple progress updates and will not support any legitimate claims for extensions of time seems lost on such contractors.

Fact or fiction? I will leave you to decide the best approach.

Understanding the importance of contract administration is vital to avoiding claims. Discover more with our Understanding Claims Under FIDIC e-course.