Another Two Specialist Contractors Bite The Dust…But Who’s Counting?

Another One Bites The Dust…

(It’s two actually – but no-one seems to be counting)

Just read about not one, but two Specialist Contractors that have bit the dust this week…

McGrath Bros (Engineering) Group has ceased trading with the loss of 171 jobs.

The firm, founded in 1981, worked on major projects across the UK, including the London Olympics Aquatics Centre, with a London office in Tottenham handling a large order book in England and a Glasgow office covering Scotland.

And…

Hull-based offsite manufacturer Modular Space Limited has fallen into administration.

The firm specialised in site cabins supplying the Costain/Skanksa joint venture on Crossrail and Wates.  It also delivered prefabricated buildings for school and health projects.

Skills and High Profile Projects Do Not Equal Success

Clearly both firms had worked on high profile projects, they don’t come much bigger than the Olympics and Crossrail. And there was no shortage of skills and expertise in these two companies, Modular had even developed a special two-storey house design, which could be assembled from four basic units in just five hours.

So What’s Going Wrong?

The fact of the matter is that whilst Trade Associations and Build UK tinker around the edges of the major issues facing you and your business, and promote nonsensical solutions to the very real and business threatening payment problems facing the industry, more Specialist Contractors are going to fail.

As Brian McGrath is quoted as saying;

“Legacy contracts taken on during the recession have also taken their toll on main contractors and specialist subcontractors alike, all linking to underpayments of completed works and disputed final accounts.”

So, if you are not getting paid properly then don’t delay in getting it sorted.

Please don’t stand for late or underpayment.

Take action

Take action to safeguard your business from the catastrophic impact of reduced, late, or non-payment in 2016.

If you don’t then it could cost you your business…

Unscrupulous Contractors use every trick in the book, to reduce and delay payments. Specialist Contractor’s efforts to avoid or rectify this problem often come too late in the process.

Don’t be one of the casualties, take action now.

You can download a complimentary “How To Get Paid” report right now, and put an end to reduced, late and non-payment.

And you can call us for initial no cost advice on 01773 712116, and our Gold and Platinum Buddies can use their commercial and contractual consultancy to find an answer.

Whatever level your business is at, and whatever your specialisation I want to encourage you to experience and enjoy a better more profitable, less stressful way.

 

Advertisements

Delays on construction site? Ignore it now and you’ll regret it later!

 

ARE YOU BEING DELAYED ON SITE?

If you are please;

  • don’t ignore it
  • don’t simply accept it as normal
  • don’t throw more men at the job to catch up
  • don’t simply accept what the Main Contractor says

At its simplest, if you are being delayed by events beyond your control, you are entitled to more time!

If those delaying events cause you to take longer to complete than originally planned, you are entitled to an extension to the contract period.

But you must take action.

ISSUE THOSE NOTICES!

Most sub-contracts will require you to identify any cause of delay or likely delay to progress, and to notify the Contractor of that delay and estimate the effect on the date for completion.

Even if it doesn’t say that, it is a good discipline to adopt in any event.

You should also be very wary of Main Contractor’s onerous notification requirements that are designed to prevent your entitlement to extension of time. Check the contract – and do what it says!

And don’t fall for the age old trick of the Contractor saying; There’s no need to be contractual or we will sort it out at the end or any other BS. It’s a trap – don’t fall into it!

FAIL TO ACT AND YOU WILL BE CLOBBERED

Specialist Contractors routinely get clobbered financially by Contractors because they have allegedly delayed the Works, and have no records or notices to say otherwise.

Here’s an example of the sort of thing coming your way if you don’t, from a live job we are currently resolving for a Specialist Contractor;

Deductions, LAD’s, Charges relating to incomplete works – £72,656.82

Setting aside any commercial considerations (but why worry about upsetting someone who is trying to screw you?), one of the main reasons Specialist Contractors get clobbered is that there is a good deal of uncertainty about what to do , and they end up like rabbits caught in the headlights.

We routinely see Main Contractors setting off monies for alleged delay in the tens and hundreds of £thousands!

Don’t let it happen to you.

PRESS YOUR CLAIMS

There are some key measures that you can implement now:

  • Understand your programme obligations under the contract, in particular the start date, duration and completion date.
  • If you cannot proceed with your work due to preceding trades, record the fact with an email, letter or fax, doing nothing is fatal.
  • Understand the requirements for submitting applications for extensions of time, as in some circumstances you may lose your entitlement with a late application.
  • If there are other delays being incurred in regard to information or variations, record the fact with an email letter or fax.
  • Take dated photographs of anything that is delaying your progress.
  • If it becomes evident that you will not complete by the completion date, you must be able to demonstrate it’s not your fault.

 

You must apply for and do whatever it takes to demonstrate your entitlement to an extension of time.

Not doing so puts you at massive financial risk.

DON’T BE PUT OFF!

Once you get your head around such matters, it all makes sense, so don’t let the way contracts are drafted, or the Contractor’s reactions put you off.

Most of all don’t put off taking action, problems do not get better with age, get those notices in and protect your interests. If you don’t do it, you put your business at financial risk, and all your hard work goes down the drain.

And remember that if you need any help to resolve such problems, please don’t hesitate to pick up the phone, take action and give us a call.

I hope you enjoyed my Wise Up Wednesday email and that it gave you some food for thought, and I sincerely hope to speak with you soon and see you at the biggest event of the year for Specialist Contractors.

UK Construction Blacklisting Scandal – It’s a Disgrace!

According to reports in today’s construction media Contractors involved in the construction blacklisting scandal have settled claims with another 180 workers.

Campaigners claimed the latest payouts totaled “in the region of £15-20 million plus legal costs” and come ahead of the full blacklist trial set to start at the High Court on May 9 and scheduled to run until July 31.

Eight contractors – Balfour Beatty, Carillion, Costain, Kier, Laing O’Rourke, Sir Robert McAlpine, Skanska UK and Vinci PLC – have set up The Construction Workers Compensation Scheme to try and settle with victims out of court.

A spokeswoman for the Contractors confirmed that 180 new settlements had been reached, and the Blacklist Support Group said there are currently 154 live claims remaining plus 82 recently issued new claims.

What’s that got to do with you?

You may be thinking what has that got to do with me?

Well, first of all the blacklisting happened in the industry from which we all earn our living, and frankly we should all be outraged that these Contractors behaved in this way and ruined the lives of so many people, and tarnished the reputation of the industry.

Secondly, we should be disgusted by the fact that having been found out, and in some cases admitted their part in the sordid affair, the Contractors involved have pushed their victims all the way to the steps of the court before paying out.

Lastly, Specialist Contractors need to be wary of the culture that pervades at the highest levels of some construction companies. Because frankly you need to be extremely careful that you don’t fall foul of it.

As we have seen some companies will do and say anything, so, if you do not look after your own interests, this is an industry where some people won’t think twice about making you suffer. Don’t fall for the Contractor’s BS, because it is highly likely (there are some exceptions), that what they are telling you is a pack of lies.

Take action!

One of the key areas that you need to be extremely careful about is payment. Please don’t stand for late or underpayment.

Take action to safeguard your business from the catastrophic impact of reduced, late, or non-payment in 2016.

If you don’t then it could cost you your business!

Unscrupulous Contractors use every trick in the book, to reduce and delay payments. Specialist Contractor’s efforts to avoid or rectify this problem often come too late in the process.

Don’t be one of the casualties, take action now.

Download “How To Get Paid” for free right now, and put an end to reduced, late and non-payment!

Whatever level your business is at, I want to encourage you to experience and enjoy a better more profitable, less stressful way.

 

I hope you enjoyed my Wise Up Wednesday email and that it gave you some food for thought, and please don’t hesitate to grab your Free Report at “How To Get Paid” and if you need any help with any of your business problems pick up the phone and give us a call on 01773 712116.

Construction Disputes: 3 Crucial Factors Determine Whether You Win or Lose

Where’s the evidence?

This week’s “Wise Up Wednesday” is about a recurring problem that catches Specialist Contractors out over and over again.

It’s all about the evidence!

Or to put it another way, and I quote from a learned source;

“Most cases are won or lost based on the strength or weakness of the parties’ evidence, so it is vital to ensure that as much relevant evidence (both documentary and witness) as possible is gathered at an early stage (ideally before proceedings are even issued).”

3 Crucial Factors Determine Whether You Win or Lose

There are three crucial factors that determine whether you win or lose and please, please, please bear these in mind even before you enter into the contract, and especially when you are doing the work. Because come the end of the job (and you’re not getting paid properly) it will be too late.

The three factors are;

  • the evidence (facts),
  • the relevant law when applied to those facts, and thirdly,
  • the tactics of the case.

Whilst our Consultants are extremely good at the law and the tactics, the most important of the three is the evidence, as very few cases are won without strong evidence to support the winner’s arguments.

Getting the right evidence early is crucial, not only so you can properly assess the strength or weakness of your case, but also to try to persuade your opponent to negotiate an early and hopefully cost-effective settlement.

If you are not sure what evidence to collect or how to collect it, please give me a call on 01773 712116 and let’s talk it over.

The Good The Bad and The Ugly!

Evidence takes many forms and with good evidence a good Quantity Surveyor, Construction Contracts Consultant or Lawyer (all of whom are available via StreetwiseSubbie) will be able to substantiate your claims for variations, extensions of time, additional costs, and of course helping you get paid.

 

Without it you are at the mercy of the Client or Contractor who wants to allege all manner of wrong doing against you and make the resultant deductions from your account.

 

In the 26 years that I have spent representing Specialist Sub-Contractors in all sorts of contractual situations, I have come across the good, the bad and the ugly.

 

The Good

 

The good came from a mechanical services sub-contractor who had all of the following records in place:

 

  • Weekly progress reports detailing exactly where his works had been delayed.
  • Progress photographs cross-referenced to the progress reports.
  • Labour allocation sheets detailing exactly where his men were working every day.
  • Delay notices confirming the most significant delays and cross-referencing them to the progress reports and photographs.
  • All of the contract documents recording in precise terms the agreement between the parties.
  • Detailed variation submissions cross-referenced to marked-up drawings and instructions.
  • Daywork sheets signed by the Contractor.
  • Confirmation of verbal instruction forms confirming all the verbal instructions received from the Contractor.
  • Copies of all the Contractor’s instructions.
  • Detailed programmes showing the impact of delays.
  • Detailed interim applications.

 

Needless to say, when the time came to prepare that particular Specialist Sub-Contractor’s claim for extensions of time and delay and disruption costs, all the information we needed was readily to hand.  The net result was that the claim was very economical to prepare and resulted in a substantial settlement in the Specialist Sub-Contractor’s favour.

 

The Bad

 

The bad came from a steelwork sub-contractor who had undertaken a multi-million pound project for a very well-known petro-chemical company.  The work undertaken was first class and in all but the contractual aspects of the project, the Specialist Sub-Contractor had performed impeccably.

No proper systems were put in place initially and contractually the project was a bit of a shambles. The Specialist Contractor had even been persuaded to stop issuing notices, very much against our advice!

 

Several months passed and the Specialist Sub-Contractor completed his works in spite of all the problems he had encountered.  By this time his costs were a cool £500,000 more than he had recovered!

 

The blue chip multi-national petro-chemical giant’s response to this claim?

 

They told him that he had not kept proper records as required by the contract.  In particular, they said that his claim failed because he had not issued the delay notices required by the contract!!!

 

The Ugly

 

Trust me, ugly is an under-statement!  The only proper records this particular ground-works contractor had were photographs!  Literally hundreds of them.

 

His claim was that he was entitled to be paid circa £1,000,000 for labour plant and materials.  At the point in time, he consulted me he had finished the work and had been paid only £500,000.

 

It is fair to say that he had been turned over good style by the main contractor, but he had certainly made a massive contribution to his own downfall.

 

Apart from the supplier’s invoices, he had no proper records of anything.  He had no proper wage records and could never explain how he had employed his labour.  He had submitted monthly applications which were completely unsupported by any back-up information.  His daywork sheets simply referred to “Ground-worker(s)” instead of named individuals.  He had no measures of the work he had undertaken and no marked up drawings.

 

Not surprisingly, the cost of unscrambling this situation was considerable and although our considerable efforts on his behalf secured a further £250,000, this was well short of a profitable outcome!

Need More Information?

We have lots of resources at your disposal from the free information on our web site, to our specially written guides for Specialist Contractors, to our exclusiveLinkedIn Group of 2,192 Specialist Contractors, right through to our best sellingGold Buddy Membership.

(Speaking of which, I’d just like to  remind our Gold Buddies to use their free consultancy time to help you resolve any of your problems. We love helping!)

Do not suffer alone. Come and find out how we are helping Specialist Contractors of all sizes, in all trades, right across the UK.

I hope you enjoyed my Wise Up Wednesday email and that it gave you some food for thought, and I sincerely hope to speak with you soon.

In the meantime if you need any help with any of your business issues, please don’t hesitate to pick up the phone and give us a call on 01773 712116.

When you’re not getting paid in construction, when is the problem not about payment?

Don’t confuse the two…

Question: When you’re not getting paid, when is the problem not about payment?

Answer: When it’s a dispute about valuation.

The two things are interconnected but they are not the same!

They are different problems that require different solutions.

Reasons for under valuation in construction

There are a wide range of reasons why you might not be getting paid properly, but the most common are the under valuation of your account including variations and valuation of the final account.

There are several steps that you can take to avoid under valuation.

First, know your contract: It is important to always check the terms and conditions of your contract and be fully aware of specification of the works, payment terms, variations and extensions of time clauses and adjudication clauses.

Secondly, keep in touch with the Contractor or Client: Always give regular progress updates to Contractors and inform them of any factors that may give rise to variations delays etc. This can be achieved by regular agreed meetings and effective management.

Thirdly, before carrying out any additional work, ensure that you receive written instructions from the Contractor or Client and do not wait until the end of the project to try and get values agreed.

Keep everything: You can never keep too many records. Respond effectively to any verbal requests and ensure that you take pictures of the site, retain email conversations and, importantly, document any reasons for delayed progress.

Please don’t stand for late or underpayment.

Take action!

Remember that problems never resolve themselves.

If your works are not being properly valued, take remedial action early. The sooner you tackle the problem the less impact it is likely to cause, and the sooner you get the money the better.

It’s an old adage but you need to get your money out of the tin before it’s empty!

Try going to the top: If discussions at site level are not addressing a certain issue, then go to someone senior in the Contractor or Client’s business. Senior management is often able to take a broader perspective and this wider view can often help resolve disputes before they escalate.

If you do encounter problems that are not getting fixed, discussing things at an early stage with one of our expert legal advisers can be cheaper and simpler than trying to resolve an escalated dispute further down the line.

Take action to safeguard your business from the catastrophic impact of reduced, late, or non-payment in 2016.

If you don’t then it could cost you your business!

Unscrupulous Contractors use every trick in the book, to reduce and delay payments. Specialist Contractor’s efforts to avoid or rectify this problem often come too late in the process.

Don’t be one of the casualties, take action now.

Download “How To Get Paid” for free right now, and put an end to reduced, late and non-payment!

Whatever level your business is at, and whatever your specialisation I want to encourage you to experience and enjoy a better more profitable, less stressful way.

 

I hope you enjoyed my Wise Up Wednesday email and that it gave you some food for thought, and please don’t hesitate to grab your Free Report at “How To Get Paid” and if you need any help with any of your business problems pick up the phone and give us a call on 01773 712116.