Employee health, material shortages top list of coronavirus concerns in construction | Planning, timely communication help address unavoidable project delays due to coronavirus | Boston mandates 2-week construction stoppage; emergency projects to continue
March 18, 2020
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The construction industry is likely to experience the effects of the coronavirus pandemic in six key areas, including employee health, material shortages, project financing and legal issues, according to experts. Contractors need to be particularly aware of any force majeure clauses that could emerge as an issue in a project, lawyers say.
Planning and timely communication can help address project delays that result from the coronavirus pandemic, two attorneys write. Issues to consider include supplier agreements and contracts' force majeure clauses, the attorneys write.
The John Hancock Tower in Boston (Elsa/Getty Images)
Boston's mayor has required that construction projects in the city be placed on hold for at least two weeks because of the coronavirus, although emergency projects such as road repairs will be allowed to continue. Officials of some other cities, including San Francisco and New York, are taking or suggesting similar measures.
The Armed Services Board of Contract Appeals has held that an email sent 10 days after final payment was not a timely notice of a contractor's intent to seek additional compensation. The decision is a reminder for contractors to make sure they strictly follow all notice provisions in their contracts, an attorney writes.
Contractors need to take steps now to protect themselves from potential negative effects of the coronavirus outbreak. Force majeure and price acceleration clauses are two key ways contractors can manage risk in contracts, an attorney writes.
NASBP Blog: Guidance on potential impacts of coronavirus on the construction industry
(Centers for Disease Control and Prevention)
Contractors need guidance in regard to the impact of the coronavirus on construction projects. A group of attorneys from Peckar & Abramson offer suggestions to help mitigate the impact and prepare for what's to come, for existing contracts as well as new negotiations. In all instances, they assert, "parties should assess insurance product options and review existing insurance policies for potential coverage." Read more.
March 24 NASBP Virtual Seminar on AIA 2019 Documents: Construction Manager as Adviser
Don't miss this Virtual Seminar presented by Ken Cobleigh, managing director and counsel at the American Institute of Architects (AIA). Join us at 2 p.m. Eastern on March 24 for AIA 2019 Documents: Construction Manager as Adviser. Cobleigh will review the changes in the construction industry since the 2009 release of this family of documents and how these industry changes are addressed in the 2019 edition of this family. He will also discuss the expanded Construction Manager's Preconstruction Services and a new Sustainable Projects Exhibit. Register for this standalone NASBP Virtual Seminar or register for the NASBP 2020 Virtual Seminar Annual Subscription, the entire set of Virtual Seminars for 2020, and save! This Virtual Seminar is sponsored by Old Republic Surety. Register.
New NASBP Surety Story! When the unexpected happens, trust and relationships help keep bonding secure
In the most recent NASBP Surety Story, Alex Paris of Alex E. Paris Contracting shares how trust and relationships impact the construction business and bonding, especially when unplanned events happen. "If our bonds would have been reduced or cut, we would have been in trouble. It's really important to keep a relationship between the broker, the bonding company, and the contractor." Check out all the Surety Story videos posted at the NASBP Be Guaranteed to Succeed site.
Contractors can prepare themselves for a potential recession by reviewing their financial health and staffing levels, an economist said. Among the steps they should take are raising cash, evaluating their lines of credit and being certain they are on good terms with insurers and banks, he said.
I do not wish [women] to have power over men, but over themselves.
Mary Wollstonecraft, writer, philosopher, women's rights advocate March is Women's History Month
Founded in 1942, NASBP is the association of and resource for surety bond producers and allied professionals. NASBP producers specialize in providing surety bonds for construction contracts and other purposes to companies and individuals needing the assurance offered by surety bonds.