Completion Date Unknown: How to recognize and plan for common delays based on labor productivity.

Construction contractors must complete a project based on the time table it provided to the party looking for work to be done. 

The time table includes an element of labor productivity to estimate when a project can be completed.  This element is referred to as labor productivity.  Labor productivity is how a contractor can measure work that is completed over a specified period of time.  Generally, a contractor will bid for work based on the estimated productivity level the contractor has available. A loss of labor productivity occurs when a contractor takes longer to complete work than it should have if some intervening cause had not happened. 

When a work day must be modified, or the overall schedule of the project must be changed, it affects all parties involved.  Most productivity issues are identified after the fact, and either a claims process or litigation has begun.  By identifying and creating an awareness of possible issues with labor productivity, a contractor is better able to protect their interest in keeping the project moving, and keeping their reputation intact.

1. Weather. In the Midwest, nothing can hamper a construction project more than weather.  From snow to rain to high winds, the Midwest faces adverse weather in almost every season, year-round.  To counteract this natural hindrance, propose contractual language that permits additional time for “unusually severe weather.” This can cover a contractor who faces adverse weather effects that impacts labor performance or labor availability.

2. Unavailability of manpower. A lack of adequate numbers of persons to complete a project may occur because of weather, or there may be a shortage of laborers for any number of other reasons.  A contractor can face delays if there is a constant struggle to maintain a steady workforce.  It can be difficult to prove and recover from a lack of manpower which causes delays in project completion.  A traditional construction contract places the burden on the contractor to provide for and maintain a steady workforce until completion. While the possibility of a waning labor force may be hard to agree to in a contract, the recognition of such a problem prior to the start of a project may provide the parties time to come to an understanding of what may become a reality.

3. Overtime. Fatigue and continuous absences due to increased and frequently scheduled overtime work can lead to adverse effects on productivity.  Scheduled overtime is well within the contractor’s control and should be taken into consideration when creating the project’s time table.

There are many issues that can delay a construction project.  Being able to foresee those issues and contract around them is the key to minimize any damages from a delay.  Labor productivity is one of the most common reasons for delays in construction projects.  Being aware of potential labor productivity problems will better prepare contractors for any delays that do occur. 

Even better than awareness is a well-drafted contract that provides a clear understanding as to how delays will be handled.  A well-drafted contract provides more security to the contractor in charge of labor productivity.  With the right contract in place, potential delay-casing issues can be dealt with before there is even the mention of litigation.

For additional information regarding construction law, contact one of our experienced Sioux City attorneys, Sioux Falls attorneys, or Omaha attorneys. For more articles like this one, check out our Construction Lawyer blog!