Connecting New Zealand

Who foots the bill if COVID-19 impacts your project?

21 Dec 2021

We may have moved away from major national or regional COVID-19 lockdowns, but that doesn’t mean we are home free when it comes to avoiding the pandemic’s impact on civil construction projects. Unfortunately, there is still potential for COVID-19 cases to force mandatory site shutdowns,  and we still face challenges when key staff members are required to miss work at short notice if they are required to isolate after coming into contact with a COVID-19 case and being deemed a close contact.

In situations such as these, who pays the costs, and should contractors receive a time extension if Government COVID-19 requirements impact their staffing levels and ability to complete a project on schedule?

The answer is in your contract. If it doesn’t say anything about COVID-19 then chances are you will be paying and you may not get a time extension. This is not just about head or main contractors either, if you are a subtractor and your staff need to stand down because they are a close contact with a positive case on site, who pays their wages?

The Construction Sector Accord has produced a document on this, titled COVID-19 Construction Risk Management, which provides helpful advice (see page 7).

The principles apply across all clients. If a client states that they should be exempt as they have not signed the accord, the response may be “…yes but you are a leading client and this is what we would expect from you”.

CCNZ members are reminded that they can access 15 minutes free legal advice from Dentons Kensington Swan. To access this service, please log into the website and send us your query using the member discounts portal.




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